WASHINGTON -- Republicans are clueless about the economic devastation they are courting with brinksmanship over raising the nation's debt limit, Democrats charged Tuesday.
Senate Majority Leader Harry Reid (D-Nev.) leveled the charge in his floor speech Tuesday morning, and his office followed with a press release pointing to a list of influential business leaders and economists who warn that the U.S. government's failure to pay its bills would spark a new financial catastrophe.
"Failure to avert this crisis would have dire consequences," Reid said. "It would result in the most serious financial crisis this country has ever faced. Millions of Americans could lose their jobs. Social Security checks could stop. So could paychecks to our troops."
Reid argued that the GOP was willing to risk those financial hardships in order to protect subsidies for the oil industry and tax breaks for corporate jets.
Soon after he fired that broadside, Reid's policy shop pointed to a Tuesday morning discussion between MSNBC's Joe Scarborough and two top Republicans -- presidential contender Tim Pawlenty, the former governor of Minnesota, and Republican Party Chairman Reince Preibus. Pawlenty and Preibus had said they did not know what to expect from a default:
Scarborough: What's the impact if it's not raised?
Pawlenty: Well, we don't know that.
Scarborough: Well, I don't know what's going to happen to me if I jump off a cliff. But I think I'll go splat.
Preibus had a similar view:
Scarborough: What do you believe, though? Do you believe that if we don't raise the debt ceiling the economy will just keep chugging along normally or do you believe it will cause a financial crisis?
Preibus: You know, I don't know, because we've never been there before, Joe.
Reid's team noted that numerous economists, business leaders and Republican leaders have warned of disaster if the nation's spending cap -- now set at $14.3 trillion -- is not raised by early August.
Under a release titled "REPUBLICAN LEADERS CLUELESS ON THE CONSEQUENCES OF DEFAULT" Democratic Policy and Communications Center spokesman Brian Fallon named several of those who have been warning of the consequences of default.
"While [Pawlenty and Preibus] may be at a loss to explain the consequences of a failure to raise the debt limit, many business leaders and fellow Republicans know the dire consequences of a failure to raise the debt limit," the release said.
Among those singled out were Warren Buffett, who said not raising the limit would be "asinine;" Republican elder statesmen James Baker, who backed the hike, and JP Morgan Chase boss Jamie Dimon, who echoed Treasury Secretary Tim Geithner in saying a default would be "catastrophic."
Despite the Democrats' criticism of Republicans, Don Stewart, a spokesman for Senate Minority Leader Mitch McConnell (R-Ky.) was unimpressed with Reid's own plan to reduce the deficit, citing a list of tax cuts Reid had mentioned and arguing that Democrats want to hike taxes a lot more.
"The point is, Sens. Reid and [New York's Chuck] Schumer complained this morning that Sen. McConnell doesn't support the Democrat plan to raise hundreds of billions in new tax hikes on job creators in the middle of an employment crisis," Stewart said. "They're correct: Sen. McConnell does not support hundreds of billions in new tax hikes on job creators. He agrees with what the President said last year -- tax hikes in a down economy will make matters worse and slow job growth."
Stewart was referring to Obama's decision to extend the Bush-era tax cuts for the wealthy for two years.
He also argued the money saved by ending the breaks for oil companies would not be nearly enough to eliminate the deficit, and suggested Democrats should offer their full list of tax hikes or revenue raisers.
Fallon said the Obama administration has offered McConnell and Republican leaders hundreds of billions of dollars worth of choices to raise revenue, and all were turned down.
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