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Home Publications Blogs Beat the Press Republicans Detail Plans for Defense Against Martians

Republicans Detail Plans for Defense Against Martians

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Friday, 21 January 2011 05:41

The NYT reported in some detail on the plans by conservative Republican House members for large spending cuts. The piece included several comments from Republican members saying that the country was on the edge of default.

It would have been helpful to point out that there is zero evidence to support this contention. Bond holders are willing to hold U.S. government debt at extraordinarily low interest rates. This means that investors who have tens of billions of dollars at stake do not share the concerns about the government's solvency expressed by these members of Congress.

It is also worth pointing out that the United States would never be in the same box as Greece or Ireland, as asserted by one of the representatives quoted in the article. Since the United States has its own currency, it can always have the Federal Reserve Board buy its debt. This can create a risk of inflation (in the current economic environment this risk is near zero), but there is no possibility that U.S. debt will lack buyers, as was the case with Greece and Ireland. 

In other words, this is a totally imaginary threat, like the prospect of Martians invading. It is possible that members really fear an attack from Martians, but responsible news reporting should point out that there is no basis in reality for such fears.

Comments (3)Add Comment
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written by izzatzo, January 21, 2011 6:33
This means that investors who have tens of billions of dollars at stake do not share the concerns about the government's solvency expressed by these members of Congress.


This is big commie lie. They're the same people.
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written by Chris, January 21, 2011 9:22
Bond holders might well be willing to hold U.S. government debt at low interest rates, but the government still needs to approve a budget to pay that interest. As it happens, Republicans are well placed to talk about a default as they are threatening to hold the country hostage unless their demands are met.
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written by Matt, January 21, 2011 10:38
"It is possible that members really fear an attack from Martians"

It's more plausible than a lot of stuff they *do* believe (Mooslems taking over America, the GHEY AGENDA, the invisible man in the sky who only cares about fetuses until the moment they're born, "tax cuts increase revenue", etc) so it would actually be an improvement.

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About Beat the Press

Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.

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