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Jack is a graduate of Rutgers University where he majored in history. His career in the life and health insurance industry involved medical risk selection and brokerage management. Retired for two decades after many years in NJ and NY, he occasionally writes, paints, plays poker, participates in play readings and is catching up on Shakespeare, Melville and Joyce, etc.

Saturday, January 14, 2023

01-14-2023 - The Debt Limit as seen by 'Marty's Blog,' Insurrection Supporters, a Santos Solution, and Classified Documents

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Raising the Debt Ceiling and Reducing Spending on Social Security, Medicare, and Aid to Ukraine

Republicans are willing to cut Medicare
and Social Security to appease their extremists 

My lead piece in today’s posting was supposed to be about the Republican effort in the House to refuse to raise the debt limit (something like raising the maximum limit on a credit card), a process which enables the Treasury Department to sell bonds and issue notes to acquire the money to pay the government’s bills.  This happens, whether you agree with it or not, every year, regardless of what Party is calling the shots.  We reach that debt ceiling next week.  Fortunately, there are strategies that the Treasury will use to buy a few months more time!

Uncle Sam is known as someone who pays his bills, and that includes paying interest on the debt. That’s why government bonds are highly rated.  Investors, here and abroad, trust Uncle Sam.  But the Republican House majority plans on allowing the debt limit to be raised only if there are balancing cuts in spending, specifically in Social Security and Medicare benefits and military aid to Ukraine. That is bad news for Ukrainians, and even worse for Americans, even though a Democratic Senate or a presidential veto can torpedo such G.O.P. dreams.

Retired lawyer Marty London produces an occasional blog and he deals with this issue (he calls it ‘Scary Shit’) in a current posting.  So, here it is, stated far better than I could do it.  Welcome to ‘Marty’s Blog’:

12 JANUARY 2023


Marty London


We are witnessing one of the more troublesome electoral periods in modern times. A fractured Republican party that still has not given up the ghost of Trumpian “leadership”, needed 15 separate votes to elect a Speaker,  and finally succeeded only after the leading candidate made a series of humiliating promises to a small group of hard-right conservatives. Some of the promises are in writing; others are reported be "hand-shake" undertakings known to but a few in the "Freedom Caucus."


The issue that causes the most discussion in the press is the threat by some of the in the hard right group to balance the budget by reducing Social Security and Medicare payments. It's hard to believe the Republicans would tinker with Social Security, also known as "the third rail of politics" but they seem to be doing it anyway. Polls show 82% population is opposed to any such move.


The scheme goes like this: each year the government passes legislation establishing a new debt limit. It is, as expected, traditionally higher than the previous debt limit. Republicans assert this is improvident, and insist on capping the debt limit, despite the fact that the last time they were in power they skyrocketed the public debt via dramatic reductions in tax rates for the wealthy.


Obviously, there are fundamentally two ways to balance a budget: you either increase revenue ( i.e., raise taxes) or cut spending. Republican leadership (to the extent there is such a thing) has focused on the latter – specifically military spending (think Ukraine) and welfare services such as Social Security and Medicare.


I have read more than one article that suggests this is all much ado about nothing because any such legislation passed by the House would fail in the Senate or be vetoed by Biden.


But those writers miss the point. The Republican plan is a repeat of the hostage-taking exercise the hard right used in the Speaker election. Instead of passing a bill reducing those expenses – a bill that would certainly fail – the plan is to refuse to raise the debt ceiling. In the past negotiations have always yielded a compromise. But one of the terms of the McCarthy hostage-taking is said be that the new Speaker  refuse any agreement on the debt ceiling issue unless the Democrats agree to reduce spending on the military budget, Social Security, and Medicare.


A failure of a three-branch compromise would cause a shut-down of the government. Arguably, the Treasury would not be able to pay its bills. Hospitals, physicians, Social Security recipients would not get their checks, (and the Ukrainians would not get their howitzers).


 But this is not as simple as it sounds. Government spending is different from household spending. Government spending is dictated by previously enacted legislation and by the Constitution of the United States.


The legislature has, over the years gone, enacted legislation establishing Social Security and Medicare at specified rates. That makes it a government debt. The Constitution has something to say about government debt. The 14th Amendment,  Section 4 reads, "The validity of the public  debt of the United States, authorized by law, … shall not be questioned." 


Can the obligation of the Treasury to pay out Social Security and Medicare “as authorized by law” simply be negated by the will of the hostage takers? Not so fast. A number of Constitutional scholars have opined that the Treasury would be Constitutionally obliged to pay legislatively authorized Medicare and Social Security debt whether such payments exceeded the debt limit or not.


If, as I expect, the administration insists on poking a hole in the debt ceiling to make Social Security and Medicare payments, we will for sure have a court battle. I have little doubt the political views of the majority of this Supreme Court would result in a Court ruling against making those Social Security and Medicare payments.


That would, I suggest, raise an interesting question that, so far as I have read, has not been addressed by scholars. 


Some history: In 1832, there was a legal dispute about whether the State of Georgia had the right to decide whether white men could reside on Indian territory. The case went to the Supreme Court. The State of Georgia took the view that inasmuch as the Indian territory was within its boundaries, only the state had jurisdiction, and refused even to appear in the Supreme Court. The Supremes took the opposite view, and Chief Justice John Marshall wrote the Court’s opinion ruling against Georgia’s position.  President Andrew Jackson, upon learning of the decision, is reported to have said “John Marshall has made his decision, now let him enforce it."


So I cannot help but wonder whether or not this would be an occasion to give this Supreme Court,— which has the lowest public approval rating anyone can recall, — the black eye it deserves. 


What if the conservative majority of the Court ruled that the Constitutional sentence quoted above does not apply to these circumstances and the Treasury could not cut the checks? 


Treasury Secretary Yellin will do what the
14th Amendment allows her to do. 

And then what if the Secretary of the Treasury, with the full approval of the President of the United States, said, “I have a Constitutional obligation under the 14th amendment to pay out Social Security and Medicare debts to citizens. I am going to do my duty and make those payments. Samuel Alito has made his decision, now let him enforce it.”


The result? After November, 2024 we would no longer need to worry about Kevin McCarthy!


A bientot! 



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Believers in the Insurrection

We should not forget the insurrection that took place on January 6, 2021.  Recently, Robert Pape, a political science professor at the University of Chicago was reported to have led a research project looking into what motivated the protestors. Although they found that there were other factors involved, the researchers concluded that race ‘accounted for as much as 75% of the energy underneath the insurrection movement.’

They investigated further, looking for reasons why many Americans who were not there with the protestors in Washington on January 6, agreed with them.  They came up with the following numbers:

Twenty-one million Americans believe that (1) Joe Biden stole the election, and that (2) violence would be justified to restore the defeated former president to power.  The researchers identified two conspiracy theories underlying this dual belief.

Half of this large group (perhaps 10 million) believed that ‘a secret group of Satan-worshipping pedophiles was running the country’ and three-quarters (perhaps 15 million) believed in the ‘great replacement theory,’ whereby white Americans are intentionally being supplanted by people of color.

Without more information as to the methodology of this research, it should not be taken as being conclusive but certainly, at a  minimum, it does show that there are millions of Americans out there whose judgement is highly questionable.  And they vote, almost always for Republicans.

Not touched upon, and what worries me, are the numbers of those in law enforcement at all levels, including the Secret Service and the FBI, as well as in the military, who share such questionable beliefs. That can be very dangerous for the survival of democracy.



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Apples and Oranges: 

Misplacement and Stealing

Here’s a comment I made on Heather Cox Richardson’s daily *‘Letters From an American,’ about the Republicans equating the ‘classified’ papers found in President Biden’s home, garage and old office with the purloined documents found sequestered at Mar-a-Lago by the defeated former president:

“All those commuters lugging briefcases on trains and busses are employees bringing work home from the office, to work on after dinner. Occasionally, what's in those briefcases can get misplaced. I suspect this is not an uncommon occurrence. And if the employee works for the government, those papers might well be classified to some extent, and should not have been in that briefcase in the first place, but it happens anyway. The work has to be finished, and there are deadlines to be met. And when those misplaced papers eventually turn up, it is a very different situation than papers that were intentionally withheld from government officials authorized to take them. Don't compare apples and oranges.”

But Republicans who think they now ‘have something’ on President Biden make a great mistake by inviting a comparison of the two situations, making what the defeated former president did appear as being ‘okay’ since even Joe Biden did it.’ 

The more effort they devote to that, trying to make President Biden’s misplacing of papers in the past appear to be the equivalent of what his predecessor in office did, the stronger the DOJ’s case against the defeated former president becomes for his inexcusable actions, intentionally taking government papers with him into retirement, claiming they were his, and withholding them from the government officials charged with reclaiming them. 

That is a far cry from what Biden had done, and the fact that even those 'lesser' incidents warrant investigation of them by the DOJ strengthens the DOJ's efforts to bring the defeated former president to legal accountability for the far more serious actions that he carried out in regard to the documents that he did not merely ‘misplace’ but actually 'purloined.'

The Special Counsel appointed to look into Biden’s misplacement of papers cannot be unaware of the work being done by another Special Counsel appointed to handle the several possible criminal acts by the defeated former president, including the documents he stashed away in Mar-a-Lago, and elsewhere in Florida.  At worst, Biden’s knuckles will be rapped, but the defeated former president will likely face indictment and prosecution.  Apples and oranges!  It takes lawyers to know the difference in this country.  Many voters do not.

 * Have you been following Professor Richardson each day?  I recommend that you do!  Check her out at (https://heathercoxrichardson.substack.com/) and if you like what you read, pass it on to others.


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A Santos Solution

If half a dozen Republican representatives, including those in neighboring districts who have already asked for Santos' resignation, walked into Kevin McCarthy's office and told him that this faker's presence in Congress stains their entire party, hurting its re-election chances and that they would no longer vote with the Republican majority in the House until he is gone, ending their thin majority there, watch how fast he would be gone.  McCarthy buckled under to his Freedumb Caucus antagonists.  He should buckle under pressure from his supporters, as such a group of representatives would likely be.


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Two Items of Interest:

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Have a nice day.


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