Can the United States pay 100% of its financial obligations? Of course. That is not the issue driving the downgrade of U.S. creditworthiness by Standard & Poor's.

Rather, S&P's downgrade is a pointed critique of our political system -- the reality that we have a group of political extremists, nihilist, who have invaded and seemingly conquered the Republican Party of Ronald Reagan conservatives.

This band of political hooligans are both unable and uninterested in governing. Reagan would have a hard time recognizing these Tea Partiers as real Republicans.

Let's face it, the Tea Party has sought to shut down the Government by any means necessary. As another expression of their nihilism, fresh from the Tea Party's foray into vandalizing America's economic stability, they most recently blocked funding of the Federal Aviation Administration, purely for ideological reasons.

It is fair to assume that any rational American would agree that the FAA, responsible for our civilian air transportation system, is a critical agency to keep funded.

But we are not talking here about a group of people moved by the quaint notion that Government decisions must be made with reason, using empirical data, and a spirit, as the U.S. Constitution says, of promoting the "general welfare" of all Americans.

This band of Tea Party ideologues in Congress share a quasi-religious zeal that can withstand exposure to any contradicting data or objective reality. The whole world, including vast majorities of Americans, yelled at them "don't blow up the American economy!"

Yet they purposefully drove the country to the very precipice of calamity, to paraphrase Federal Reserve Chairman Ben Bernanke.

Is it surprising then that such a radical, destructive agenda is creating significant market turbulence? Not in the least. In fact, it would be surprising if it didn't seriously rock global markets -- as it has.

Congresswoman Michelle Bachmann, a candidate for president in 2012, is the Chairperson of the Tea Party Caucus in Congress. She voted against the deal to raise the debt ceiling. Why? Dana Milbank of the Washington Post writes:

When Michele Bachmann was asked during a television interview last week whether she thought higher unemployment would increase her chances of winning the presidency, she gave an unexpectedly candid reply: "I hope so."

Now she's putting that theory to the test. On Wednesday, she argued that failure to raise the debt limit -- a prospect that even Republican congressional leaders say could lead to economic catastrophe -- might not be such a bad thing.

"This is a misnomer that I believe that the president and the Treasury secretary have been trying to pass off on the American people, and it's this: that if Congress fails to raise the debt ceiling by $2.5 trillion, that somehow the United States will go into default and we will lose the full faith and credit of the United States. That is simply not true." ...

It bears mentioning that Congresswoman Bachmann is consistently ranked near the top in most 2012 GOP Presidential preference poll. Predictably, she draws most of her support from people that identify with the Tea Party.

And she is now blaming President Obama for the downgrade -- a craven bet that Americans are too clueless to know that Bachmann and her band drove the country into the economic paralysis that S&P cited as one the main reasons for the downgrade.

But you wouldn't know this from her latest statement on the downgrade. According to FoxNews, Bachmann is pointing her finger at Obama for supposedly causing the downgrade that she and her Tea Party allies sparked through their mindless opposition to a deal with trillions of dollars in cuts:

"...This president has destroyed the credit rating of the United States through failed economic policies and his inability to control government spending by once again raising the debt ceiling..."

This logic-free pretzel of an argument is what now passes for serious discussion of economic policy among the Tea Party faithful.

While it's worth reading the entirety of the Standard & Poor's statement, there are a few choice sections that clearly point to the Tea Party lunacy as a contributing factor to their negative outlook:

"...The political brinksmanship of recent months highlights what we see as America's governance and policymaking becoming less stable, less effective, and less predictable than what we previously believed. The statutory debt ceiling and the threat of default have become political bargaining chips in the debate over fiscal policy. Despite this year's wide-ranging debate, in our view, the differences between political parties have proven to be extraordinarily difficult to bridge, and, as we see it, the resulting agreement fell well short of the comprehensive fiscal consolidation program that some proponents had envisaged until quite recently. ..."

And the "less stable" policymakers fingered by S&P for blocking real budget reform?

"...Compared with previous projections, our revised base case scenario now assumes that the 2001 and 2003 tax cuts, due to expire by the end of 2012, remain in place. We have changed our assumption on this because the majority of Republicans in Congress continue to resist any measure that would raise revenues, a position we believe Congress reinforced by passing the act...: 

The world's most powerful country was brought to the edge of financial chaos by Mrs. Bachmann and her Tea Party cohorts. Americans should never forget the damage that they have caused the whole nation. Beyond the hit to our national finances, the spectacle of Tea Party Members of Congress actually trying to justify an American default has made our Congress the laughingstock of the world.

But America is no punchline. Never. We are a democracy with the ability to overcome any challenge -- even an invasion by right-wing barbarians seeking to destroy the fabric of our society, the very strength and stability of our economy.

In the 2012 election, Americans from what I call the Patriotic Center, real Republicans, Democrats and Independents, should make sure that these Vandals are driven from the Congress and State legislatures across the nation.

America's future hangs in the balance of the 2012 election -- so we better get it right.

The die has been cast. Obama's "nearly complete capitulation to the hostage-taking demands of Republican extremists," as an editorial in the normally sedate New York Times described the deal to raise the debt ceiling, is a disaster in the making. It rules out a vigorous government response to the persistent economic stagnation in which joblessness, housing foreclosures and an ever-widening gap between the top 2 percent and the rest of Americans have become the norm.

But to use the word "capitulation" is too kind, since this president, as was Bill Clinton before him, is clearly one of those "New Democrats" who welcomes the opportunity to jettison the legacy of Franklin Delano Roosevelt as outmoded political baggage. Otherwise, why would Obama have reached for a "grand bargain" in which he even put Social Security and Medicare cuts on the table before the Republicans rolled him?

That same opportunistic reasoning got us into the Great Recession, thanks to President Clinton joining with congressional Republicans to destroy the sensible controls on Wall Street greed that FDR had put in place in order to prevent a repeat of the Depression. That was also the rationale of the Clinton alums that Obama appointed to clean up the mess they themselves had created. Instead of worrying about jobless workers and swindled homeowners, they bailed out the swindlers, following the example set by George W. Bush.

Those policies caused the 50 percent run-up of the national debt between 2007 and this week, when the debt ceiling had to be raised. While the trillions wasted made the bankers whole, it did nothing for the 50 million Americans losing their homes or the 20 percent of the workforce that can't find the full-time employment for which they are qualified. The economy has zeroed out in the past six months, relative to population growth, and in June consumer spending had its biggest drop in two years. The fundamentals are rotten, as reflected in the steep descent of the stock market despite the raising of the debt ceiling.

The Republicans in control of the House excluded such dismal facts concerning the actual state of the economy when they set the terms for the debt ceiling debate, terms the president came to accept. Following the back and forth between Congress and the White House, one would have thought that the recession is over and now is the time to fix extraneous problems that are a quarter of a century up the road, like the baby boomer impact on Social Security. If adults, of either party, had been watching the store, raising the debt ceiling would have been a no-brainer. Instead, the obvious obligation to pay debts that Congress had already incurred was turned into an occasion to wage ideological war on the very idea of government.

In the end, Obama agreed to major cuts at a time when the government needs to spend more money on extending unemployment insurance, mortgage relief to avoid foreclosures, and support for state budgets so that more teachers and firemen are not laid off. That would put money in the pockets of people who would spend it, rather than continue the tax breaks for the rich and coddling the corporations that are sitting on a $2 trillion surplus they refuse to invest.

To cut federal expenditures in the midst of a deep and persistent recession would have been viewed as madness by every modern Republican president, from Eisenhower, Nixon, Ford and Reagan to both Bushes. Ronald Reagan had no qualms about doubling the entire national debt that had been accumulated by all previous presidents from George Washington to Jimmy Carter.

In the current debate, Republicans were accurate in reminding that the presidents from their party had to contend with Democratic grandstanding, including by then-Sen. Obama, in opposition to the inevitable lifting of the debt ceiling. But raising the debt ceiling was always assured and never once did the Democrats go so far as to threaten to put the United States of America into default or risk the nation's perfect credit rating.

Neither party has ever dared to use the deficit ceiling to blackmail the entire nation -- until now. And for that, the GOP is the party clearly at fault. But it is also true that, in his zeal for centrist consensus, a preoccupation doomed to failure in a time of tough choices, it was Barack Obama who folded.

There used to be a good and necessary reason for labor unions: to protect the rights, pay and treatment of ordinary workers.

Nowadays, I'm not so sure.

Let us investigate:

Unions are undeniably a major reason why Obama was elected. Without them, he remains a junior Senator from Illinois (given his annoying habit of voting 'present,' perhaps he even slinks into oblivion from there). Fact: the SEIU and its sister unions of all flavors backed Obama and dropped Hillary. Likewise, unions were a huge factor in the election of Democratic Presidents going back to Clinton, Carter, Kennedy, Truman and FDR.

If you have a union job and cannot get fired, you probably are rabidly pro-union.

If you like the looks of Richard Trumka and the things he says, you probably have a union worker in your family at the very least, if you're not one yourself. One of the many objectionable things he said was that the only reason not to vote for Barack Obama is racism. What he actually said was "there's not a single good reason ... to vote against Barack Obama ... and there's only one really, really bad reason to vote against Barack Obama ... and that's because he's not white" and we can see from these unnatural semantics how he so cleverly tries to back door his racist slam.

Besides being racist in and of itself (one can't vote for another candidate because they don't like Obama's policies or lack of experience?), Trumka's little Obama pep rally is proof that Obama is in the unions' pocket. If you can sit through the seven minutes of Obama propaganda that fat-cat Trumka spews, you'll get a shrill crescendo about "right-wing race haters Limbaugh, O'Reilly and Ann Coulter." Now, this union-boss is acting as a self-appointed moral and racial conscience of America? I have never had a good feeling of integrity or conscience from union bosses or especially the unions themselves. To me, Trumka and his radical, Socialist diatribes are the embodiment of everything that's wrong with this country.

One thing is clear: the unions all love Democrats and hate Republicans. See what's happening there? See how the Dems so eagerly align themselves with the unions in exchange for money and votes?

From a paper entitled, "Union Corruption in America: Still A Growth Industry," by Carl F. Horowitz:

To research the issue of corruption in America's labor unions is both exhilarating and exasperating. Few experiences are more satisfying than reading and then writing about organized labor's embezzlers and extortionists getting their just deserts. Yet despite all the expulsions, arrests, indictments and convictions, there is also despair. For the story too often stays the same even if the cast of characters changes. Corruption remains deeply embedded in the way unions supposedly represent dues-paying workers.

Or this, from a John Stossel expose, "Public sector unions are parasites that will bankrupt America," said James MacDougald, President, The Free Enterprise Nation, "it is literally the parasite devouring the host," he warned. Watch closely as the fat, sweaty Transit Workers Union boss first laughs with delight at the NYC MTA's $800 million budget shortfall then squirms and dodges when asked simple, direct questions. He also unselfishly tries to give viewers a history lesson of unions. Lame, he is. Lame and vile.

Among the 'benefits' accruing to TWU members working on NYC's transport system are:

- Reaching the top pay level in the 3rd year;

- 30 vacation days in the first year of employment;

- Many sick days (which they use, some taking 50 or more per year; 51 TWU workers took off an average of 64 days in one year);

- Retire at 55

- A healthcare plan of extravagant proportions

I am continually amazed at how good, honest and decent people can still support the idea of unions and be completely oblivious to their basic deceitfulness. I guess some people are willing to overlook anything to achieve their political goals.

That's my first problem. Unions have become unashamedly dishonest organizations often infested with criminals who viciously cheat the American taxpayer and their members.

Another problem I have with unions is that I always see far too many union workers standing around; drinking coffee and watching one guy turn a screwdriver. It's empirical evidence at best, but it's what I frequently see and it seems valid to me. So my second problem is that union workers these unions supposedly protect are often lazy, unqualified slackers who cannot be fired and are looking for a free ride on the backs of the rest of us. Yes, this happens in non-union work situations, too, but less often.

This drives up prices and cost for the rest of us who have to work until we're 65 or older; don't get 30 days vacation or 54 sick days our first year on the job and don't have a 'Cadillac' health-care plan.

When you tally up the political corruption unions create, their workers' appalling lack of productivity and how the economy is ruined by the totality of these dynamics, you see that unions have outlived their usefulness and have become an ugly caricature of what was once a noble idea.

There's no way honest, hard-working Americans should let these denizens of destruction steal from us, ruin our economy and make all our lives harder and more expensive.

A silver lining: Thankfully, the percentage of American workers who belong to unions is under 12%, the lowest percentage since 1932.

Though counter-balancing the above happy statistic is the fact that government workers now comprise the biggest percentage of union members rather than the private sector -- an ominous sign indeed.

So until we can eradicate the dishonest and corrupt unions while keeping the honest ones, municipalities in particular will continue to suffer, as will the rest of the workers and American economy.

I know the 'Workers of the World Unite' squad will attack me ferociously. I don't care. Somebody must stand up to these atavistic descendants of Marx, Lenin and Trotsky and call 'bullshit.' Their way was tried in places such as the Soviet Union (notice the word 'union' ... hmmm), Mao's China, Castro's Cuba, Nicaragua and other ill-fated and heartrending geographies. It didn't work.

Quite the opposite, it enslaved hundreds of millions of people for more than 70 years and put progress on hold for the entire world while sparking two world wars.

Undoubtedly the world would be a better place without unions. And prices would be lower too.

(Corporations? Think I'm a shill for corporations? Stay tuned. I'll tackle the corporations in a column soon.)

The debt ceiling impasse in Washington is an inevitable consequence of a deeper problem: we govern like frogs.

Students of introductory biology learn a basic lesson about sensory perception in a quirky behavior found in certain amphibians that has become common lore. By now we all know that if a frog is placed in hot water he will immediately jump out to safety. However, if the frog is placed in cool water that is gently heated to boiling, the frog does not perceive the gradual rise in temperature or the impending danger. Likewise, when our leaders are faced with a problem or emergency that is an obvious attention-getter, they will react quickly to solve the immediate threat -- a frog leaping from scalding water. But like the doomed frog sitting patiently in water growing imperceptibly ever warmer, we often miss the cues to the more insidious danger of a mortal threat that results from an accumulation of smaller less noticeable problems. That is exactly what has happened over the past decade.

Washington collectively suffers from what is known in the manufacturing world as "process drift" as our democracy ages. Process drift for our politicians is analogous to that water coming to a slow boil for our hapless frog, now dead and boiled. In the comfort of our global dominance our attention wanes, we become complacent and ignore what truly threatens us. Our human nature focuses our attention on novelty; we lose interest in the familiar, making it ever more difficult to take on systemic and chronic problems of national security and economics.

Our politicians have become like experienced pilots who fly a perfectly good airplane into the ground because they are so focused on a trivial problem, losing sight of the big picture. Probably the first classic case of this phenomena in modern aviation is the 1972 crash of Eastern Airlines Flight 401 in which the pilots allowed the jumbo L-1011 Tristar to plow into the Florida Everglades while fiddling with a landing gear light. They killed 101 people and lost a multimillion dollar airplane because of a $2 light bulb. Aviation has learned much since then, but our politicians have not. They in fact are about to drive a perfectly good economy into the ground on the basis of petty partisanship.

Manufacturers address the issue of process drift by looking for "root causes." In understanding why processes are drifting, procedures can be implemented to prevent such drift. We need to do the same in the world of politics. In Washington we see at least four root causes of process drift and its multiple consequences: complacency, false confidence, arrogance, and tunnel vision. Let's look quickly at each.

Complacency arises from the inertia of past success and from fortuitously positive results from previous indiscretions. "I've done this a hundred times before." With each successful outcome we become ever more insensitive to any brewing dangers, willingly dismissing warming signs upon the weighty evidence of favorable outcomes. The problem of ignoring the consequences of and becoming complacent about debt began with Ronald Reagan. During his eight years in office, Ronald Reagan (1981-89) ran up more debt than all 39 of his predecessors combined, from George Washington through Jimmy Carter. Reagan tripled the national debt. And no, that is not the fault of a Democratic congress: the budget as submitted by Reagan actually included more debt than what was eventually passed. This is easily enough verified by a quick Google search, but I know this from personal experience too -- I was at the State Department at the time and saw the annual budgets submitted to the Congress by the Executive Branch. During his eight years, George W. Bush ran up more debt than all 42 of his predecessors combined. Bush doubled the national debt . Under Bush the Republicans voted seven times to raise the debt ceiling, from $5.7 trillion in January 2001 to $10.7 in December 2008. The water was getting hotter but nobody noticed or more accurately, pretended not to as everyone began to perspire. And as a result we now find ourselves near the fatal boiling point.

False confidence results from our inability to distinguish between dumb luck and skill, usually dismissing the former and claiming the latter. "I've gone through tough economic times before and came out just fine. I don't see what the big deal is. I know what I'm doing." Such false confidence leads to a form of amnesia and blindness, so we quickly forget that much of the current debt crises originates in George Bush's tax cuts. If we are filled with confidence that our views are correct, how could we possibly entertain the notion that we need to change course?

Arrogance is a relative of false confidence, but has different consequences. The most recent incarnation of this arrogance is the revived and heavily modified idea of "American Exceptionalism." The modern version ignores or offers lame excuses for all the ugly aspects of our history, including slavery and the near destruction of native Americans, while implying America has a god-given mandate to save humanity. With god on our side we can't be wrong, and therefore we become immune to reason and logic. By definition all that America does is right -- because America did it. So with that tortured logic torture is accepted for a greater good; individual rights are encroached in the name of security (illegal wire tapping, suspension of habeas corpus). Foreign policy is reduced to "you are with us or against us."

Tunnel vision compels us to see only that which supports our conclusions and to ignore all else. We invaded Iraq on the basis that Saddam Hussein was developing and would use weapons of mass destruction. Bush, Cheney and team saw in the evidence only what they wanted to see. Yet we know now that the intelligence community repeatedly warned the administration that the case for WMDs was weak at best. With tunnel vision Bush supporters made the odd argument that he was best suited to keep us safe because no terrorist attacks had occurred on his watch (9/11 of course did; but that was Clinton's fault). Yet we hear no such argument to support Obama, when in fact there really have been no terrorist attacks under his watch (and if one did no Republican would claim it was Bush's fault). With tunnel vision we filter out any data that does not support our conclusion.

Process drift is seen in how we elect our representatives. With the exception of just a few years between 1964 and 2010, we reelected incumbents to the House more than 90 percent of the time, and in many years, like 1998, 2000 and 2004, the number is an astonishing 98 percent. In most years the number of incumbent Senators reelected is well above 90 percent. These numbers alone indicate a system in which elections can hardly be called a fair referendum, but they become surreal when we understand that a majority of Americans "disapprove of the way the U.S. Congress is doing its job." A majority of us reelect virtually the same Congress (98% the same) of which we strongly disapprove. Process drift.

The best cure for process drift is to acknowledge the phenomenon. We cannot fight complacency if we are unaware of being complacent. We will not be motivated to address the consequence of false confidence if we do not recognize the process of slow degradation in our objective analysis. We cannot break free from our tunnel vision if we believe our sight to be wide field.

So what can we do to get to prevent process drift and tackle the root causes of Washington's ills? Jeffrey Liker, a former executive at Toyota, explained that the auto manufacturer bore down to their problems' root causes with "a very 'sophisticated' technique; it is called five-why. We ask why five times." What that means is that few problems are more than five degrees of separation from the problem initially discovered and that problem's ultimate cause. This principle of five-whys can be broadly applied to discover root causes in almost any circumstance in virtually any field, including politics.

Let's first look at how the principle is applied outside of politics to get a sense of its utility. Take an alternator failure in an airplane. Why did it fail? The belt came loose. Why? The mounting bracket broke. Why? Too much engine vibration. Why? The mounting bracket pads are worn and need to be replaced. Why? Because the maintenance program was not designed to catch wear of the mounting pads.

Now to politics. Why do we have mounting debt? Expenses exceed revenues. Why? A combination of tax cuts, a slowing economy, rapidly expanding entitlement programs, and the cost of two wars. Why? Political leaders in both parties have failed to lead, and instead have pandered to voter whims and succumbed to the growing influence of lobbyists pursuing narrow rather than national interests. Why? Voters have not demanded better; we are ultimately responsible. Why? American voters want benefits without paying for them, or want others to pay for them, and have not sacrificed to pay for the on-going conflicts in the Middle East; we want something for nothing, and that leads to crisis.

By being vigilant against the insidious drift that robs us of reason, we can mitigate danger, manage risk properly and be better citizens and voters. We do so by making a concerted and conscious effort to avoid a fate similar to that poor clueless boiled frog. Beware of slow creep.

Jeff Schweitzer is a scientist, former White House senior policy analyst and author of Calorie Wars (July 2011) and A New Moral Code (2010). Learn more about Jeff at http://jeffschweitzer.com.

This summer the more obscure Section 4 of the 14th Amendment to the U. S. Constitution was brought up in discussion by former President Clinton and several esteemed justices. This section was meant to assure the payment of Union Army debts after the Civil War, and to disavow Confederate ones, but was written in broader terms.

"The validity of the public debt of the United States, authorized by law, including debts incurred for payments of pensions and bounties for services in surpressing insurrection or rebellion," the critical sentence says, "shall not be questioned."

This is the constitutional escape hatch which Clinton and several legal scholars assert allows the president to lift the debt limit in these dire circumstances. Obama has said he talked to several legal scholars who are not certain that it is a winning argument. Methinks that another urgent conversation is in order, Mr. President, and the next time you appear on television in prime time you make a simple declarative statement: "I have evoked the terms of the 14th Amendment to the Constitution to lift the debt ceiling. If my esteemed Republican opponents in the House choose to fight this move, I welcome their legal challenge in court."

That is a legal fight I would love to see in the midst of the next election campaign. I suspect they will retreat with their tails between their legs rather than go up against a fait accompli which has saved the economic system of the world. Yes, Mr. President, it IS time for the Founding Fathers of the nation to come to your -- and our -- rescue. Do it! Today!

So much for the meritocracy. Despite an elite education, effusive charm and brilliant wit, Barack Obama, like Bill Clinton before him, has ended up betraying his humble origins by abjectly serving the most rapacious variant of Wall Street greed. They both talk a good progressive game, but when push comes to shove -- meaning when the banking lobby weighs in -- big money talks and the best and the brightest fold.

The defining moment of Clinton's capitulation was his destruction of Brooksley Born, the one member of his administration with the courage and prescience to warn him about the unregulated derivatives trading that ultimately led to the housing collapse. For Obama, it is his decision not to nominate Elizabeth Warren to run the new Consumer Financial Protection Bureau, which she fought so hard to create.

Obama's refusal to take the fight to Senate Republicans by nominating Warren should be taken as the vital measure of the man. This gutless decision comes after the president populated his administration with the very people who created the financial meltdown.

The Harvard credential worked for the likes of economist Lawrence Summers, who carried water for Wall Street under both Clinton and Obama, but not for that university's distinguished law professor Warren, an outspoken defender of consumer rights who dared represent the interests of the victims of the banking scams. It is a painful reminder that for Democrats as well as Republicans, governance is still all about serving the rich.

Both Democratic presidents had no difficulty appointing top bankers and their acolytes to all of the key economic positions in their administrations but drew the line at fully backing the rare member of their team who had a proven record of defending the public interest when it was being savaged. Consider the fawning treatment of former Goldman Sachs partner Gary Gensler by both Clinton and Obama. In the Clinton Treasury Department, it was Gensler working under both Robert Rubin and Summers who forcefully pushed for the radical deregulation of the financial industry that led to the biggest economic implosion since the Great Depression.

As Sen. Bernie Sanders, I-Vt., put it in opposing Obama's nomination of Gensler to be head of the Commodity Futures Trading Commission, the position once held by Born: "Mr. Gensler worked with Sen. Phil Gramm and Alan Greenspan to exempt credit default swaps from regulation, which led to the collapse of AIG and has resulted in the largest taxpayer bailout in U.S. history." This bailout was engineered in cooperation with the Bush administration by Timothy Geithner, then head of the New York Federal Reserve Bank, who was rewarded for his catering to Wall Street avarice by being named Obama's treasury secretary.

With Geithner and Gensler now in charge of reregulating Wall Street as ordered by the Dodd-Frank law, it is no wonder that the lobbyists have been able to stall any significant progress in controlling the ever-threatening time bomb of the still unregulated $600 trillion over-the-counter derivatives market. It was after all Gensler who assured Congress back during the Clinton years that Brooksley Born was an alarmist and that the "OTC derivatives directly and indirectly support higher investment and growth in living standards in the United States and around the world."

No wonder Gensler had no difficulty being confirmed by Senate Republicans and Democrats, who are basically united in giving Wall Street lobbyists the governance they paid for. Of course, the main culpability is with congressional Republicans, who are dead set against any meaningful consumer protection.

For that reason, they are likely to oppose the person Obama nominated instead of Warren, former Ohio Attorney General Richard Cordray, who has acted forcefully to defend consumer interests. As David Lazarus, the knowledgeable business columnist for the Los Angeles Times, wrote, "President Obama shouldn't have backed down" in the face of GOP opposition to Warren, because Republicans will probably also find Cordray unacceptable. The reason being that they don't want a strong director for the consumer protection agency, or even the agency itself.

What remains to be seen is if Obama will play their game or finally take the gloves off. If we should have learned anything in the last decade of financial malfeasance by the banking industry, it is that consumers are in desperate need of protection. If Obama goes to battle for Cordray and he proves to be a strong director for the new agency, I will stand corrected, but the president's abandonment of the brilliant and dedicated Warren is hardly an auspicious beginning.

So it's not about the deficit after all.

For months we've heard the increasingly shrill alarms being sounded by supposedly sober-minded Republican Congressional leaders that America is the next Greece -- balancing carefully over a debt precipice, destruction inevitable unless radical action is taken.

These alarms have been so effective that the true nature of our national crisis -- chronic unemployment at unacceptably high levels, overall slack economic demand -- has been relegated to a secondary plane of importance. Some 20 million people unemployed or under employed are not just a human tragedy but a major contributor to our still under-performing economy.

The GOP trope that the federal government deficit is somehow responsible for high unemployment defies common sense and basic economics. Yet this fallacy is repeated often and loudly as if it were a proven fact. Meanwhile, the chairman of the Federal Reserve recently told Congress that the Fed is ready to take even more aggressive action -- read some massive stimulus -- if the economy falters.

So we come to the intransigence of Republican "negotiators" trying to hammer out some compromise to raise the debt ceiling with the Democrats. It would seem that these elected leaders' responsibility to the country, their oaths of office, is seemingly trumped by their religious oath to Grover Norquist, the founder of special interest group Americans for Tax Reform and the godfather of the "all taxes are evil" movement, to never raise taxes regardless of the economic conditions

This fetishistic oath, seemingly sworn and signed in blood, has kept the Republicans from saying "yes" to President Obama's offer for raising the nation's debt ceiling -- a deal that would whack some $4 trillion dollars from the national deficit.

Charlie Cook, one of America's most respected non-partisan political analysts, is brutal on the Republican's stance on the debt ceiling -- and thinks that it may cost them the support of Independent voters in 2012.  Cook writes in the National Journal:

...What has happened is that the New Republican Party has come to hate taxes a lot more than it hates deficits and the country's growing indebtedness. It has rewritten history to omit any acknowledgment that President Reagan, when it was necessary, went along with tax increases. The memory of Reagan accepting tax increases, however reluctantly, has been supplanted by President George H.W. Bush's fateful decision to go along with tax increases in the 1990 budget negotiations.

What the New Republican Party remembers is Bush losing reelection, not the fact that those tax increases were pivotal in eliminating the federal budget deficit under President Clinton and in the resulting period of strong economic growth. Bush's loss is remembered, and the period of fiscal responsibility is forgotten. At least history will treat Bush 41 with more gratitude than his own party does...

Why did the Congressional Republicans walk away from the biggest deficit reduction pact in history?  

Based on a several recently published polls, Americans everywhere outside of Washington are befuddled by their elected leaders' stance in these negotiations.

A new CBSNews poll found that "only 21 percent of the people surveyed said they approved of Republicans' handling of the negotiations, while 71 percent disapprove." Other recent polls point to a similarly stark divide between Republican voters and their elected representatives.

So why walk away from a great deal to shrink the government deficit?  Could the "of the 1%, by the 1%, for the 1%" be the reason?  A recent  article in Vanity Fair by Nobel-winning economist Joseph Stiglitz is as cogent as it is alarming:

Americans have been watching protests against oppressive regimes that concentrate massive wealth in the hands of an elite few. Yet in our own democracy, 1 percent of the people take nearly a quarter of the nation's income -- an inequality even the wealthy will come to regret.

Stiglitz goes on to say that enlightened self-interest -- the patriotic desire for the whole country to prosper, for the middle-class to thrive, so you too can be successful - should provoke the "1%" to support policies that improve the whole of society, not just those initiatives that dump tax benefits to the wealthiest Americans paid for by the middle class.

Warren Buffett, the iconic self-made American man, is clear on this subject. No one has made a dime in this country without the unique advantages that America offers, he repeats and repeats. From an ethos of fairness, hard work and sacrifice, to a belief (at least in classical American mythology) that any kid can grow up to be president, the success of every American is tied to, as the U.S. Constitution states in its preamble "the general Welfare."

Stiglitz writes that the 1% no longer identify with the bottom 99% -- and that this division is bad for all Americans, rich, middle class and poor.

When the "1%" fund and elect elect representatives that are committed to the welfare of that "1%" at the expense of the 99%, we find ourselves in a dire situation with negatively profound implications to the future of America and our ability to remain the world's leader.

In fact, we find ourselves in a self-created, completely avoidable, national crisis that shatters Americans' faith in their own government while also damaging America's standing in the world.

Are we seeing the new model of Barack Obama's presidency? Is this (in the parlance of Silicon Valley) "Obama 2.0"?

This seems to be a large point that all the overanalysis of rumors in the past few weeks has largely missed. Partisans on both sides have been kept busy having fits of the vapors over unconfirmed (and, for the most part, unsourced or anonymous) rumor leaks about what is "on the table" in the debt ceiling negotiations, while the media is content to sit back and fan the flames. In the midst of this frenzy, nobody seems to have noticed that President Obama is negotiating in a markedly different way than what we've seen from him in the past. Obama is at the absolute center of the showdown, he is using the bully pulpit for all its worth, and he has not (so far, unless you choose to believe this rumor or that) backed down on a few key "lines in the sand." All of this is nothing short of a sea change from how Obama handled (for example) the healthcare reform battle.

Since there is no agreement yet -- no grand "deal" has emerged from the talks between the White House and congressional leaders -- I'm going to wait to discuss the particulars of such a deal until it actually... you know... exists. I realize I am jeopardizing my standing among my peers by doing so, because apparently I'm supposed to be fulminating about whatever is the current rumor du jour right about now, along with the rest of the pack. Instead, I'd like to focus on the process, and the way President Obama has conducted himself in the negotiating process.

Republicans will, of course, discount any such discussion by stating that Eric Cantor singlehandedly got Obama involved by petulantly walking out of the discussions Vice President Joe Biden was holding, a few weeks back. This can be largely ignored, since it doesn't really matter what led Obama to take a commanding role, now that he has done so.

Several complaints about President Obama's governing style (admittedly, many of them expressed in this very column, in the past) centered on his inability to effectively conduct legislative negotiations. Rightly or wrongly, Obama was portrayed as a mere cheerleader on the sidelines, while Nancy Pelosi and Harry Reid struggled to get the details worked out on paper. Even this cheerleading was judged ineffective, since Obama showed a strange aversion to taking his case directly to the American people (or, at the very least, making his case to the mainstream media). Obama seemed content to ride out the fray, holding himself above the messy business of hammering out details, and expressing only vague "goals" which he later could claim were "90 percent met" by whatever legislation emerged. This, the complaint went, allowed Obama to avoid risking any political "failure" which came as a result of supporting any facet of the plan which did not actually make it into the final agreement. It also avoided the heat from the public (especially his base), and redirected this annoyance to the leaders in Congress who were actually up to their elbows in the dirty work of give-and-take negotiations. And, at the end of the day, Obama would cave on just about anything merely in order to get some sort of bill -- any bill -- through Congress and onto his desk. No matter where you stood on past fights (again, such as healthcare reform), this portrait of the president in such negotiations should sound pretty familiar.

Compare this to what has happened in the past month on the debt ceiling talks. Obviously, since we're not done, we can't compare what the final result will be. But all the rest of the "conventional wisdom" of how Obama negotiates seems to have been turned on its head, to one degree or another.

Obama is indubitably at the center of the debt ceiling negotiations. He is not "passing the buck" to Congress on these talks. Obama has given an extraordinary (and, for him, unprecedented) three press conferences in the space of less than two weeks -- in addition to appearing in any media interviews which will put him on camera. In these appearances, he has been using forceful language to frame the issues as he sees them, instead of just allowing his opposition to hog all the television time and present their argument unchallenged. By doing so, Obama has set the Republicans not only back on their heels, but also at each other's throats (or so it is rumored). Obama has drawn lines in the sand, and then defended them and not backed down (so far, at least) -- such as saying any large deal must include tax increases in a 1-to-3 ratio with spending cuts. He has threatened to use his very large political ace-in-the-hole by hinting that letters soon will go out to Social Security recipients which will warn that the checks will stop if the debt ceiling isn't raised. He has been playing the "multi-dimensional chess" which was ascribed to him in the early days of his presidency, by offering a plan he knew would never pass the House, so that his own party could howl about how he was giving away the store on Social Security and Medicare -- when there was no chance of this actually happening. He is, to be blunt, taking heat from both sides in the debate. By doing so, he has positioned himself exactly where he wanted to -- as "the adult in the room." Call it Clintonian "triangulation" if you will, but heading into a presidential campaign, it's not actually that bad a political stance for Obama to take. By doing so, Obama has shown with crystal clarity the extreme positions of the Tea Party Republicans (and, by extension, the Republican Party itself) these days, in a way that he simply has not managed yet in his presidency.

All of this adds up to a very big shift in governing style by the president. Now, you can speculate about what caused this sea change (the upcoming election, the fact Republicans control the House, the exit of Rahm Emanuel from the White House, etc.), but it's getting harder and harder to ignore the fact that Obama has indeed changed how he conducts himself in these legislative fights. We did see a precursor to this, back in December, when Obama personally got involved in the "lame duck" session of the outgoing Congress. He cut a deal on extending the Bush tax cuts (which Democrats howled over), but by doing so also gained other legislation which Democrats loved -- including the repeal of "Don't Ask, Don't Tell," an important nuclear arms reduction treaty with Russia, medical care for 9/11 first responders, a payroll tax cut for everyone, and an unemployment benefits extension -- none of which would have gotten done if Obama hadn't personally cut the tax deal. The result, with the public, was that his approval ratings jumped upwards for the very first time in his entire term in office. Which, undoubtedly, the White House took note of.

Lest I be accused of being too Pollyannish (Pollyannaish?) here, it's obvious that whatever deal gets struck is going to have some things contained within it which are going to upset some Democrats. It will, in all likelihood, also have some features which will upset me personally. No deal is perfect. More importantly, Obama was going to disappoint a certain amount of both his base and the lefty blogosphere by whatever he did in the debt ceiling fight. The very fact that we're even having this battle (rather than, say, a fight over further stimulus spending) is annoying some on the left already -- and they will be annoyed by any outcome, no matter what it contains. Dire predictions abound that Obama has so alienated his base that they simply won't turn out for him next year, however, these must be weighed with the astoundingly good fundraising numbers Obama just announced. It seems not all of Obama's base is that eager to jump ship. Perhaps the debt ceiling deal will be the straw that breaks the proverbial camel's back for large portions of Obama's base, but then again it may not be. If Obama can sell whatever deal emerges as "balanced" (something he's done a remarkably good job of framing, in this whole debate), then he may retain quite a bit of public support. And if his "Obama 2.0" strategy actually works for him, then maybe he truly has changed his negotiating style for the better, and maybe his poll numbers will go back up again (as they did in December).

Senate Minority Leader Mitch McConnell made the biggest news this week, by making a "Plan B" proposal as to how to get beyond the immediate crisis. The proposal is so astounding that it makes me seriously wonder if the fantasy speech I imagined in last week's "Friday Talking Points" actually happened (to some degree or another). Obama, I wrote last week, should just lay down the law and state that he would -- at a certain date -- go with the "Constitutional option," or play the "Fourteenth Amendment" card. He should state to the negotiators that he would act unilaterally under the clear text of the Constitution to declare the debt ceiling itself unconstitutional and void, and just go ahead and pay what needed to be paid since it had already been approved by Congress in this year's budget.

What McConnell is proposing is extremely close to Congress agreeing with this reasoning -- in advance. McConnell would, in essence, agree that President Obama could raise the debt ceiling on his own, at least until after next year's election. The Republicans in Congress would get to vote on this after the fact, but could only overturn Obama's decision with a two-thirds vote (much like a veto). McConnell knows he's never going to get two-thirds in either house, meaning the whole vote would be nothing more than political nonsense to be served up in the heat of the campaign season. Republicans could strongly position themselves politically as being against raising the debt ceiling, with no consequences at all to the actual debt ceiling. It's called "having your cake and eating it too," at least when it comes time to beg political donations from Wall Street. The only gaping flaw in McConnell's Machiavellianism is the hard cold fact that Congress would have to vote on this scheme in the first place. Republicans in Congress (at least a few of them) would have to vote to abdicate their power (as they see it) to President Obama, so they could later gnash their teeth when Obama actually used the power Republicans would thus hand him.

Which is the key fact -- Congress would be, in essence, agreeing with the president that the power to raise the debt ceiling was too serious to be left in the hands of Congress. "Stop me before I screw up again!" is another way of putting it. The Republicans, of course, are gleeful that they'll be able to frame the issue as "Obama's debt ceiling hikes," because they figure that if the president is the one singlehandedly doing so, then the public can be conned into believing that Congress had nothing to do with it, and that the Republicans in Congress were actually strongly fighting to keep him from doing so. This is complete elephant manure, of course, since Congress would have already abdicated this power with Republican votes, but Republicans are betting the American public won't figure that part out. Or (more accurately) remember it.

Either way, though, I do seriously wonder if Obama laid down some sort of drop-dead date, as this column suggested he do last week. Because when you strip away the political tinsel from McConnell's proposal, at its core it is nothing more than Congress just giving up on the whole debate and admitting in full view of the public that President Obama is, indeed, the only adult left in Washington.

Both of our awards this week go to Obama administration figures. An argument can be made -- for either of these awards -- that the real recipient should indeed be President Obama. But since we've spent our entire introduction talking about Obama, we thought it best to spread the coverage around a bit. If you disagree, feel free to vent your feelings in the comments, as always.

Senator Sherrod Brown deserves an Honorable Mention this week, for proposing the idea that members of Congress should have to wait until the retirement age that most other Americans have to hit, before they get their overly-generous retirement benefits themselves. This is the sort of legislation that Democrats should be backing, because it is so easily understood by the public at large, as an issue of basic fairness.

But our Most Impressive Democrat Of The Week this week is Secretary of State Hillary Clinton, who just announced that the United States would diplomatically recognize the rebel ad hoc council as the official government of Libya. Now, diplomatic recognition is a weighty matter, and America should never make this move too quickly. But, as the British saying goes: in for a penny, in for a pound. Ever since we've officially declared the Ghaddafi government illegitimate, Libyans have been waiting for America to follow the lead of others in this regard. Making this declaration will free up tens of billions of dollars for the rebels, which would give them a needed boost right about now.

The only quibble with Clinton's announcement is a silly one, but to be fair, we must address it. Clinton, in explaining why America hadn't acted sooner, said the following: "We really have acted in warp time in diplomatic terms, but we took our time to make sure that we were doing so based on our best possible assessments."

Um... "warp time"? Shouldn't that be "warp speed," Madam Secretary? Not to get into relativistic physics or anything, but one thing science fiction (back to the era of the original Star Trek television show) has taught us is that the correct phrase should really be "warp speed."

Hey, we warned you it was going to be silly. Ahem.

Quibbles aside, though (insert your own "tribbles quibbles" jokes here, if you must), Hillary Clinton's diplomatic recognition of the Libyan rebels as the true government of their country earns her this week's Most Impressive Democrat Of The Week.

[Secretary of State Hillary Clinton does not have a contact page at the State Department site, but you can always contact the White House, and let her boss know you appreciate her efforts.]

Our Most Disappointing Democrat Of The Week this week, as previously mentioned, is also a Cabinet department head, and -- again -- the argument can be made that he's merely "following the orders" of his boss.

Attorney General Eric Holder's Justice Department has, in the past few weeks, been severely backtracking on the administration's policy on medical marijuana. First a memo was released which backs up a strange policy. Then an even stranger Justice Department policy (to the point of being ludicrous) was released in a court case.

The memo doesn't completely reverse what was supposed to be the Obama policy on medical marijuana providers, but it certainly puts an odd spin on things. When Obama came into office, the new federal policy was supposed to have changed -- the feds would now only raid and prosecute people who were falling afoul of their own state's medical marijuana laws. If providers were hewing to the appropriate state laws, then the feds would look the other way, even while maintaining that marijuana was illegal, all the time, for everyone. Call it the "Sergeant Schultz" policy ("I see nothing!!!") if you will.

There are three basic problems with this approach. Number one, most state medical marijuana laws are completely silent on the production of medical marijuana, leaving a legal void. Number two, the federal raids continued (and by some measures, increased). Number three, a lot of leeway was given to individual federal prosecutors in deciding what cases to push.

The new memo seems to back up the fact that the feds seemed to be concentrating on the biggest growing operations. If an activity is deemed legal (or even "look the other way" quasi-legal), then what difference does it make whether the activity is large or small? The second problem with the new memo is that it seems to give a green light to overzealous federal prosecutors to go after state government officials for making an honest attempt to fill in the legal void when it comes to legalizing the entire seed-to-end-product production chain. Some states -- rather than leave a gaping legal hole -- decided to lay down a few rules as to what was acceptable and what was not for growers of medical marijuana. Before the new rules were even given a chance to be enacted, a few federal prosecutors sent letters to very high-ranking state officials warning them that the feds would haul their butts into court and charge them with conspiring to break federal drug laws. Got that? If a state's attorney general released regulations for legally growing medical marijuana in their state, then they would be prosecuted (read: "persecuted") for falling afoul of the drug laws. This is ridiculous, but the new Justice Department memo seems to back this reasoning up.

The memo was bad enough, but it was soon followed by the federal government releasing a lengthy report which unequivocally stated that marijuana would remain a "Schedule I" dangerous controlled substance -- which (by definition) means it "has no currently accepted medical use in treatment in the United States." This is patent nonsense, on two levels. Number one: the federal government is still supplying a few patients with medical marijuana on a daily basis, which they are allowed to legally smoke -- by federal law. This is a holdover from the 1970s and 1980s, when a pilot program was set up for people with glaucoma and other ailments which demonstrably were made better by smoking weed. Number two: fully one-third of the country has now legalized medical marijuana. Sixteen states and the District of Columbia (17 out of 51 jurisdictions, a perfect third) now have medical marijuana laws on the books. For the federal government to continue to refuse to reclassify marijuana as a Schedule II drug ("has a currently accepted medical use in treatment in the United States or a currently accepted medical use with severe restrictions") is now completely and utterly absurd.

For assumably signing off on both the recent memo and the recent report introduced in court, Attorney General Eric Holder is our Most Disappointing Democrat Of The Week this week. This is shameful, and is (to put it in Obama-esque terms) "looking backward, not looking forward." The only reason for continuing this losing war and for putting out absurd legal reasoning is political cowardice. Which is nothing short of shameful.

[Attorney General Eric Holder does not have a contact page at the Justice Department site, but you can always contact the White House, to let his boss know what you think of his actions.]

Volume 173 (7/15/11)

This week, obviously, is "debt ceiling week" in Washington, and our talking points will be reflecting this. I wrote earlier in this week on the periphery of the whole discussion, first predicting exactly what has come to pass -- that both Congress and the White House had a vested interest in stalling the talks until the absolute last minute, so that Congress won't have any time to dither at the end of the process. Then, on Wednesday, I attempted to provide some historical context to the debate with a quick look back at 1995 and 1996, when Newt Gingrich and Bill Clinton were at loggerheads over both the budget and the debt ceiling.

Today, we're going to dive into the fracas, head-on. Because, with the negotiations happening behind closed doors, the only thing left for politicians outside the room to do is to make their side's case to the media. Which Democrats have actually been doing a fairly good job of, so far, led by Obama himself.

As always, these talking points are offered up to Democrats everywhere to make use of, most especially those who are in office facing television cameras this weekend.

   Fair and balanced

There's a reason why Fox News pushes these two words as a slogan: America likes the concepts. President Obama, to his credit, has been using both terms to bolster his position in the negotiations, for the same reason. Help him out whenever you can.

"President Obama has called for balance in the debt ceiling negotiations. He thinks it is only fair that everyone in America should have to contribute to solving the debt problem. He is right. The president has offered to give ground on many issues which are near and dear to Democrats -- like fighting Republican attempts to gut Social Security, Medicare, and Medicaid. The Republicans, led by Eric Cantor in the House, have given precisely nothing. They have offered no ground, they refuse to consider any idea which does not fit within their rigid and extremist ideology, while the president continues to negotiate in good faith. We agree with the president -- any agreement should strike a balance between raising revenues and spending cuts. It is only fair to ask everyone to share the burden."

   The American people

Another thing Obama has been framing quite well is the fact that the public is behind most of the Democratic positions, in a big way. Poll after poll shows the American public agrees that it might be time to ask the millionaires and billionaires to pay a bit more in taxes. These polls rarely make the news, probably because the "journalists" would be embarrassed to admit what tax bracket they all fall into (hint: it isn't the same one as most of the rest of us). But by repeating one phrase, Obama is showing the strength of his position. Back him up!

"You know, I keep hearing Republicans trying to frame this issue as somehow 'Obama's debt ceiling hike.' They feel that if they just repeat Obama's name in conjunction with 'debt ceiling hike' that people will somehow think he's the only one who thinks the debt ceiling needs to be raised. This is nonsense. The debt is America's. It is all of America's debt, and it is the American economy which will crumble if the debt ceiling is not raised. Republican citizens will be hit by the consequences just the same as Democrats if America defaults.

"Luckily, the American people have shown, in poll after poll after poll, that they are solidly behind what the president and Democrats are saying. The American people do not want Social Security slashed. The American people do not want Medicare and Medicaid radically changed. The American people are just fine with millionaires and billionaires paying a wee bit more in taxes -- by overwhelming margins. Every time you hear an idea considered by Washington politicians, it would behoove the media to check the poll numbers to confirm that what the president says is correct -- the American people believe in a balanced approach to fixing our debt problems, unlike the Republicans."

   Instant Greece!

This should be used to counter Republican idiocy that "everything will be OK, nothing bad will happen on August the third, trust us...."

"That is utter nonsense. Republicans have been using the country Greece as a rallying cry all year now, warning us that 'America could wind up like Greece in the near future.' Now that we are faced with exactly this scenario, the Republicans are saying 'Oh, it won't be so bad.' Nothing could be further from the truth. Instead of dire warnings about some future scenario where America become Greece, Republicans will be forcing the rest of the world to immediately treat us the same as Greece. If the bond markets turn against the United States, then we would have 'Instant Greece' here at home. Why -- after warning us of the dire straits Greece is in all year -- why would the Republican force America into the same situation as Greece on the world markets? It makes no sense whatsoever."

   Instability insanity

Here's another chestnut from the Republican mantra that can be turned around and thrown back in their faces.

"Likewise, Republicans have been warning all year long that the American economy is terrified of 'instability' or 'uncertainty.' Markets, this thinking goes, are afraid of this instability whenever Democratic ideas become law, and the instability disappears whenever Republican ideas become law -- it's apparently very selective market uncertainty, I guess [pause for laughter]. But even with the naked partisanship, how do Republicans square this belief that instability is a bad thing for the American economy with the massive and unprecedented instability they are now advocating happen, by forcing America to default on its obligations? I guess that sort of instability is somehow less terrifying... or something... it's hard to follow such logic, isn't it?"

   So much for clean bills

The Republicans actually campaigned on this one. Guess they were lying, eh?

"You know, what I find amusing in the debt ceiling debate is how blatantly the Republicans in the House are breaking one of their core campaign promises. When they were campaigning, the Republicans put forth a grand document entitled the 'Pledge to America.' If I may quote from this document, the Republicans brought up the following issue: 'Advance Legislative Issues One at a Time: We will end the practice of packaging unpopular bills with "must-pass" legislation to circumvent the will of the American people. Instead we will advance major legislation one issue at a time.' That was what they pledged before they got elected. I call on every Republican who signed this document while a candidate to join with me in demanding a 'clean' bill to raise the debt ceiling right now. There is no reason why we cannot raise the debt ceiling separately from the negotiations underway to reduce our debt. In fact, House Republicans campaigned on just such a promise. I'd like to hold them to this promise right now."

   Even Reagan raised taxes

This one should be played as a trump card in debating Republican purity over raising taxes, because it puts Republicans in a very uncomfortable position.

"While I do not agree with George W. Bush's vice president or Treasury Secretary, who both famously said, 'Reagan proved that deficits don't matter,' I would like to remind the House Republicans that none other than Ronald Reagan himself agreed to multiple tax increases during his term in the Oval Office. That's right -- Ronald Reagan raised taxes. When the situation demanded it, and when negotiations would have broken down otherwise, Reagan agreed to tax increases on the wealthy. Do Republicans repudiate Reagan, or will they follow the Gipper's lead in this matter?"

   China before America's seniors?

Although this sort of thing would be the least of our problems if we did indeed default, since the Republicans have stuck their neck out, it is only fair game to use it against them.

"Nancy Pelosi pointed out this week that House Republicans are trying to pass some gimmicky legislation which guarantees that America's debts will be paid even if we go beyond the August second deadline and face defaulting on our obligations. House Republicans introduced a bill which would prioritize paying China off before paying American seniors their Social Security checks. This is the type of choice we would face if we don't get the deal made before the deadline -- deciding who to pay first. Republicans have shown their priorities, which makes me wonder why Republicans got so upset when President Obama said he couldn't guarantee that Social Security checks will go out beyond August second. Republicans howled that the president was 'demagoguing' the issue. But as far as the Republican House is concerned, Social Security will be taking a back seat to China. You can't have it both ways, guys."

Chris Weigant blogs at:

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NEW DELHI -- Indian leaders and U.S. Secretary of State Hillary Rodham Clinton will discuss security and counterterrorism efforts when she visits in days, an Indian official said Friday.

Cooperation on the economy, defense, environment, trade and other issues are also expected to be discussed, said Vishnu Prakash, the Indian External Affairs Ministry spokesman.

I've always been astounded at the near-complete lack of historical memory regularly exhibited by both Washington politicians and the "journalists" who purport to cover them. Nothing I've seen in the past few weeks has caused me to change this opinion, either, as the fight over raising the federal debt ceiling has played itself out.

While it's certainly understandable that subjects such as the Smoot-Hawley Tariff or the Greenback Party would be considered so obscure and so removed from living memory as to be ignored, there is simply no excuse for ignoring a direct parallel to today's political news, which happened only two presidents ago. Because we've been here before with the debt ceiling. Well, not precisely where we find ourselves at in 2011, but close enough to the government shutdown in 1995-96 that multiple parallels can easily be drawn.

Back at the end of 1995 and the beginning of 1996, we had a Democratic president in the White House, and a Republican House of Representatives. Then, as now, we had a huge political showdown over not only the issue of the federal budget, but also over raising the debt ceiling. Then, as now, the two separate issues had been locked together legislatively, at the demand of the Republicans. Then, as now, the president would have much preferred a "clean" debt ceiling bill. Then, as now, the biggest threat was the United States defaulting on its debts. Then, as now, one of the biggest bones of contention was proposed Republican cuts to Medicare. Then, as now, we had a bunch of radical Republican freshmen in the House. Then, as now, a presidential election was right around the corner, and both sides were jockeying for political position.

Of course, the situations are not precisely the same. Back in 1995 and 1996, a government shutdown actually happened -- twice. The debt ceiling was not raised during these shutdowns, but the country did not default on paying its debts. President Clinton actively used his veto pen, as the Republicans sent him bills which (among other things) wiped out whole Cabinet departments -- in other words, bills which the Republicans knew Clinton would not sign. The president strongly fought to avoid steep cuts to Medicare.

The biggest difference between then and now was that in 1995 the two crises happened at the same time... sort of. The immediate crisis in November and December of 1995 (and then again in January of 1996) was the fact that the federal budget for the year hadn't yet been completed. It had been due at the beginning of October, but since that point the government had been funded under a Congressional "continuing resolution" -- the same way they had always avoided passing a budget on time. But the continuing resolution had an end date. At the same time, the debt ceiling needed raising because the government was technically going to be out of money. But the deadline back then was the budget resolution -- whereas now the deadline is the debt ceiling.

The other important difference is that Clinton played his cards differently than Obama. Faced with a similar situation earlier this year, Obama did a deal for an omnibus budget bill which would get us through the end of this fiscal year. By doing so, he avoided a government shutdown. Clinton chose to have his showdown (and his shutdown) earlier in the process. What this meant was that Clinton's Treasury Secretary had some latitude in paying the bills. There are accounts which can be shuffled around in order to keep the government checks coming, and Secretary Robert Rubin did so. For which, it's interesting to note, the Republicans threatened to impeach him -- for not allowing America to default on its obligations.

President Obama, however, put the threat of an immediate government shutdown behind him earlier this year -- so that "non-essential federal employees" wouldn't be sent home, and the National Park System wouldn't close down (as happened in the 1995-96 shutdowns). But he punted on the debt ceiling due date, before the fact. Earlier this year, Treasury Secretary Tim Geithner initially told Congress (and the public) that the federal government would hit the debt ceiling on May 16. Geithner later declared that he could do some similar account-shuffling to what Rubin had done, and so could extend this deadline to July 8. He was forced to amend this as well, as the economy picked up and more tax revenue than projected came in. Which left us with August 2 -- the deadline staring us in the face right now.

But what Obama and Geithner have stated is that the new deadline is the ultimate deadline. There will be no more room to maneuver. No more Rubinesque tricks up their sleeve to shove the money around. This is a big difference from the Clinton-era crisis, because Rubin was actually able to keep things going for a few months by this sort of sleight-of-hand. Geithner will not have this option, because he has already been doing so since May.

However, even with all the differences between the Clinton shutdown and the current political fracas, how much of this have you heard discussed either in the media or in the halls of Congress? There are more similarities from the past than you might think. For instance, it's hard to tell (at a glance) which Speaker of the House made the following statement: "I can't imagine going to our [Republican House] membership and saying, 'We have this obligation to let [the president] have a wide-open credit card. No matter what he does he always gets to have more debt so he can borrow more from our children.' " For the record, that was Newt Gingrich, although it just as easily could have been John Boehner.

In fact, one of the most interesting dynamics in the whole fight right now is the power struggle going on between Speaker Boehner and the very-ambitious (and Tea Party favorite) Eric Cantor. There's even a hugely ironic parallel with today's situation that should be absolute catnip for the mainstream media to report upon (should they unexpectedly awaken from their collective stupor long enough to take about five minutes to do some basic research). Because back then -- as now -- the Speaker of the House had ambitious members of his own Republican leadership nipping at his heels politically. One of them actually came to Gingrich in private and let it be known that, while he had the utmost respect for Gingrich, the rank and file in the House (and other members of the Republican leadership) did not consider Gingrich conservative enough for their liking. An explicit threat was made: Gingrich needed to toe the Republican conservative line more reliably, or else there would be a leadership battle for his post.

The Republican leader who came to Gingrich with this ultimatum? His name was John Boehner.

Chris Weigant blogs at:

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There are few exercises more entertaining than ridiculing the nonsense that comes out of the mouths of leaders in Washington. The great part is that this is completely bipartisan. Neither party has a monopoly on solemnly stated absurdities. And of course we never have to worry about running out of material.

The winner in last week's contest was John Kasich, the former Republican chair of the House Budget Committee and the current governor of Ohio. National Public Radio interviewed Kasich in the context of a piece on the state of the negotiations over raising the debt ceiling.

NPR introduced Kasich by saying that he was chairman of the House Budget Committee "when he balanced the budget with President Clinton in the 1990s."

Kasich is then quoted as saying: "At the end of the day, you look yourself in the mirror, and you say to yourself, 'Did I do what was right for families and for children, and if I paid a political price, so what?' "

The story then concludes: "That's the kind of attitude the president wants in his meeting Thursday. Come to the White House, he says, but leave your rhetoric at the door."

Pretty touching isn't it? It may even be inspirational. After all a politician who is willing to do what is right even at risk to his career is a rare bird.

It also happens not to be true. The Washington press corps is living some bizarre delusion about the balanced budgets at the end of the Clinton years. They didn't come about from politicians making tough choices. They came about from much stronger than expected economic growth and the willingness of Alan Greenspan to ignore the economic orthodoxy and not shut down the expansion.

This can be easily seen by just looking at the projections from the Congressional Budget Office (CBO). In 1996, CBO projected that the year 2000 budget deficit would be $244 billion (2.7 percent of GDP). Instead the economy ran a surplus of $232 billion, or roughly 2.4 percent of GDP. This involves a shift from deficit to surplus of $476 billion or 5.1 percentage points of GDP. This would be equivalent to reducing the annual deficit by $750 billion in 2011.

While Kasich and NPR tell this shift from deficit to surplus as being the result of politicians making the tough choices to cut spending and raise taxes, this is simply not true. According to CBO, the net contribution to deficit reduction of Mr. Kasich's courage was minus $10 billion. In other words, the sum of the impact of legislated spending cuts and tax increases to the budget over this 4-year period was to add $10 billion to the deficit.

The main reason that the budget went from deficit to surplus was that the economy grew much faster than expected and unemployment fell much lower than the consensus in the economics profession said was possible. In 1996 CBO projected that the unemployment rate would be 6 percent in 2000. It was actually 4 percent.

This happened in large part because Alan Greenspan ignored the economic orthodoxy and allowed the economy to keep growing even after the unemployment rate fell below the 6 percent threshold that most mainstream economists viewed as a lower floor. They expected inflation to take off if the unemployment rate fell to 5 percent, and certainly to get out of control at 4 percent.

Greenspan ignored the orthodoxy and overrode the objections of the leading economists at the Fed, who were Clinton appointees. Had the Clinton appointees gotten their way and the Fed adhered to economic orthodoxy, then the budget never would have shifted into surplus. This is all easy to see with a quick look at the CBO publications.

I promised that budget blowhard mocking would be bipartisan, so let's also take a moment to ridicule President Clinton. Clinton gave an interview with the National Journal last week which was titled: "A lost decade: Bill Clinton reflects on the reasons for the economy's struggles since he left office 10 years ago."

The piece has Clinton telling us how they did things right in the 90s with the idea that this will be a recipe for future prosperity. Incredibly the piece never mentions the stock bubble that was the economy's main driver at the end of the 90s. The collapse of this bubble, at the time the largest asset bubble in the history of the world, gave us the 2001 recession and the longest period without job growth since the Great Depression (until now).

The piece also doesn't mention Clinton's high dollar policy. The over-valued dollar made U.S. goods uncompetitive in world markets and led to a soaring trade deficit by the end of the Clinton years. The massive trade deficit and the imbalances it implied created the basis for the housing bubble.

If we had reality based politics, Clinton would be hiding under a rock, not lecturing us about the route to economic prosperity. In fact, Clinton even had the gall to tell us how to create manufacturing jobs through trade, apparently overlooking the fact that the economy lost manufacturing jobs each of his last three years in office.

The facts are fairly simple here, and they are 180 degrees at odds with the stories on the budget and the economy in the major news outlets. But the budget blowhards have the money and the power so we will be hearing much more from them. We can at least enjoy playing the ridicule game.

Many presidents ride into the sunset of their life, after four or eight years of public service, content to build a Presidential Library and play golf without the weight of the world ruining their swing. Not the Job-Creator-in-Chief, however. The president who has the distinction of creating the most jobs ever of any president -- 22.5 million -- and the lowest unemployment rate in 40 years, at four percent, isn't content to sit back and let President Obama solve the unemployment challenges that America faces alone. On June 29-30, 2011, President Bill Clinton brought together over 750 CEOs, NGOs, Nobel Prize winners and young entrepreneurs to figure out how to put America back to work.

According to Clinton, "I believe that in a free society where people have choices to make and options to choose, but there is not perfect knowledge of all of those options, creating more knowledge, disseminating it and inspiring people to make those decisions can make a real difference." There are three million jobs that are unfilled today. Once filled, that alone will substantially bring down the unemployment rate.

One central theme emerged again and again at the conference--the value of education. Americans without an education are seven times more likely to be without a job. There is 15% unemployment among Americans without a high school diploma. Meanwhile, almost everyone with a doctorate is working -- with only 1.9% unemployment among PhDs.

While not all jobs require a degree, new jobs quite often require acquiring new skills. Of the 3 million jobs that remain unfilled at this time, lower-skilled work, like construction, manufacturing and entertainment remained the weakest areas of the labor market.

In some states, the public and the private sector are working hand in hand, to provide workers with new skills. Georgia Works is a private/public collaboration created by Michael L. Thurman, Georgia's former labor commissioner. Georgia Works allows employers to recruit, train and then hire staff. As Thurman explains, with this initiative, the employer gets to "audition" the employee. During the training period, the employee is unpaid, and, if there is a match at the end of the training period, the employee is hired. Thurman notes that this program reduced the cost of unemployment in the state of Georgia, while creating jobs and empowering business leaders to fuel the job growth in that state.

The Bay Area Medical Academy takes welfare recipients and others on the fringe of society and teaches them to become medical assistants in the San Francisco area. The Green City Force trains and hires young workers to paint rooftops white in New York City. This simple strategy reduces the temperature on the roof by up to 40 degrees and can cut the energy bill in the building by up to 18%.

During Clinton's time in office, in the 1990s , small business, the Internet and technology fueled jobs and economic growth. So, what innovation will lead America out of the Great Recession? Clearly, biotechnology, technology, smart phone products, cloud computing, health services and engineering remain strong, further underlining the need for a strong STEM (science, technology, engineering and math) curriculum in high schools. However, if Secretary of Energy Dr. Steven Chu and President Obama have their way, clean energy will become a major driver of American competitiveness on the world stage, as well. And not just to reduce global warming. This focus on clean energy is intended to put the U.S. in the forefront of one of the strongest new growth industries in the world.

According to Secretary Chu, "The world will demand clean energy and high energy products. This is an international competition. We still generate the best ideas in the world." Currently, clean energy companies in the U.S., like Applied Materials, KLA Tencor and Veeco Instrucments, are leading Wall Street in revenue growth, having more than doubled sales over the past two years, with 80 percent of the revenue coming from Asia. All three of these companies are profitable, with low price-to-earnings ratios (around 10).

At CGI America, Secretary Chu announced that Atlanta, Los Angeles and Seattle had stepped up to President Obama's Better Building Partners Challenge, pledging to reduce energy consumption by 20 percent over the next decade. According to Secretary Chu, buildings consume 40 percent of the energy in America and a simple "tune-up" can cut the waste, create jobs, put more money in the pockets of American business owners, while creating greater energy independence and security. Retrofitting buildings to be more energy efficient also puts construction workers back into the labor force - with new skills. Something all three cities are eager to do.

As President Clinton pointed out, "We're spending too much money on today and yesterday and not enough on tomorrow." Once the 51 commitments made at CGI America on June 29-30, 2011 are fully funded and implemented, 124,000 jobs will be created, 364,000 people will have access to job training, and entrepreneurs can tap into $265 million in investments or loans. This is a big start toward re-igniting the American Dream for the millions of Americans who are still out of work.

Natalie Pace is the author of You Vs. Wall Street. She is a repeat guest on Fox News, CNBC, ABC-TV and a contributor to HuffingtonPost.com, Forbes.com, Sohu.com and BestEverYou.com. As a philanthropist, she has helped to raise more than two million for Los Angeles public schools and financial literacy. Follow her on Facebook.com/NWPace and on YouTube.com/NataliePaceDOTCOM. For more information please visit NataliePace.com.

I watch a lot of news, and one thing that strikes me is how rarely the pundits attempt to factor in the unexpected. And yet we know from the past that what we fail to see coming invariably determines what ends up happening after. A few examples of huge game-changers of the recent past that no one predicted: Sarah Palin, the crash of 2008, birtherism, the rise of the Tea Party, the BP Oil Spill, the Arab Spring, the Japanese tsunami, the implosions of Tiger Woods, John Ensign, and Anthony Weiner...

As a corrective to our tendency toward tunnel vision, I'd like to posit the likelihood that some variation of the following will occur over the next 18 months or so:

1. The debt ceiling is not initially raised. As the market crashes, the Republicans panic, and rapidly re-vote to raise it. A furious Wall Street shifts campaign money to the Democrats, who suddenly don't mind Citizens United.

2. Obama accelerates the drawdown from Afghanistan, blaming it on the Republican budget pressure on defense spending.

3. After Ahmadinejad is arrested, Iran erupts in civil war.

4. The American double-dip recession causes layoffs in Chinese factories. Massive unrest in China results.

5. One of Michelle Bachmann's many children is outed.

6. A member of the conservative majority in the Supreme Court steps downs because of illness or dies unexpectedly.

7. Michael Moore announces a primary challenge on Obama's left -- he does surprisingly well.

8. A series of bombings occur at golf courses or other overt symbols of extreme wealth, part of a birth of new homegrown economic terrorism.

9. There is a return to back-alley and self-induced abortions resulting in a dramatic rise in maternal death.

10. A new drug-resistant strain of HIV appears.

11. After a huge earthquake, a cholera outbreak in India spreads to Pakistan, sparking border clashes and threats of nuclear war.

12. A powerful Congressional Republican is caught making anti-Semitic remarks and forced to resign.

13. The Mexican military takes over in Mexico. Thousands are disappeared in a war against the drug cartels.

14. An extramarital affair of Bill Clinton is exposed. (Nobody cares, even Hillary.)

15. A major hurricane destroys a Texas coastline city.

I will be lucky if one prediction comes exactly true, but specifics don't matter. The point is to leave space in one's head for the unknown, to approach the future with nimble thinking in an age of instant news and unintended consequences.

The one thing that we can be sure of is that we can't be sure of anything. But we can expect the unexpected.

WASHINGTON — Secretary of State Hillary Rodham Clinton is warning Syria to withdraw troops now massing near its border with Turkey, saying their presence is worsening an already bad situation for refugees and risks sparking border clashes with the Turks.

Clinton told reporters at the State Department on Thursday that the U.S. saw the situation as volatile and "very worrisome" and that the Syria military should immediately end attacks and provocations in the region. She said the buildup of soldiers just 500 yards from the Turkish border was another sign of the Syrian government's intent to repress its own people.