I THINK MCARTHY AND THE GOP are completely ready and willing to wreck our domestic and the global economy for a political win. The terms of their debt reduction plan aim to dismantle much of Biden’s agenda. I don’t believe there will be any attempt at measured compromise — only threats to get what they want. Biden and the Democrats won’t be able to give in and look weak. When it happens, finger pointing will ensue. The political strategy will be to convince the American public who was the most to blame and hope that message resonates enough to lock Congress and the Presidency in 2024. Meanwhile, everyday Americans will suffer. A resulting debt default will destroy American credibility abroad and likely decouple the U.S. dollar as the world’s reserve currency. The BRICs countries are already posturing to replace it. Investors are hedging in preparation. It looks as if we have till June before a default occurs.
Things look pretty bleak.
How Can Biden Avoid the Debt Default and all Future Debt Defaults?
Step 1. Give the GOP and conservatives a complete unwinding of federal social programs and their revenue and devolve it to the States in exchange for the removal of the debt ceiling cap requirement, student debt relief, criminal justice reform, immigration reform, and climate change legislation. Federal revenue surpluses can then focus on paying off the existing National debt.
Step 2. Blue States form a Blue State Coalition to share resources and replace those federal social programs.
Result: Avoids debt default and all future default controversies. Blue States get what they want. Red States get what they want.
It may be the only play that Biden has left that can avoid what comes next and have a chance at re-election.
While my previous post may be a little dated and I certainly underestimated Biden and the Democrats capabilities, the substance of the article I posted 2 years ago still holds true.
Details here.
