A Wall Street Journal article promoted false Republican claims which disputed the devastating effects failure to raise the debt ceiling on October 17 would have on the U.S. economy, despite recent Journal reporting which admitted default could have "cataclysmic" consequences.
In an October 9 article headlined "Obama's Default Scenario Derided," the Journal noted that according to President Obama, "if Congress doesn't raise the country's debt ceiling soon, an economic crisis with skyrocketing interest rates and a crashing stock market could follow," as the U.S. would default on its pre-existing debts -- an understanding of the manufactured impending fiscal crisis which is supported by economists and the Treasury Department.
But rather than confirm this factual assertion, the Journal instead provided a platform for Republicans who baselessly "say they don't believe" default will lead to devastating negative effects and have even "questioned what the word 'default' really means." The Journal hyped Republican claims that the White House could choose to prioritize which payments to make once the deadline hits, and claimed these misleading remarks had credence because the U.S. has never defaulted before, making the potential crisis "unchartered waters."
In reality, the Treasury Department does not have the legal authority to prioritize payments if the debt ceiling is not raised, and economists agree that congressional failure to raise the debt limit could be catastrophic, setting in motion a financial crisis in the United States and around the globe.
The "debt ceiling" was officially breached on May 17 of this year. Since that date, the Treasury has implemented "extraordinary measures" to avoid defaulting on American sovereign debt obligations by shifting funds from various accounts. The New York Times reported that these measures will be exhausted by October 17:
Economists of all political persuasions have warned that a failure to raise the debt ceiling by the Treasury's deadline of Oct. 17 could be catastrophic. The world economy's faith in the safety of Treasury debt would be shaken for years. Interest rates could shoot up, and stock prices worldwide would most likely plummet.
The Journal itself has previously reported the devastating consequences the prospect of default is already having on the worldwide economy. On October 8, the Journal reported that short-term U.S. debt prices had fallen "amid rising investor concern about the prospect of a government-debt default, sending the yield on one-month U.S. Treasury bills to its highest level since the financial crisis." The same day, the Journal reported that China had warned the U.S. of default's "global ramifications," and that banks in the United Kingdom have begun "stockpiling cash" and preparing for "cataclysmic" consequences.
Domestically, money for government employees, the military, Social Security, Medicare, food safety inspections, and more could cease or be delayed, and CNN business correspondent Alison Kosik reported that "if a default happens, there's one analyst who says that the S&P 500 could drop 45 percent."
Furthermore, the claim that the administration could choose to prioritize some payments over others in order to avoid default is false. Tony Fratto, a former Treasury Department assistant secretary and senior George W. Bush White House staffer called payment prioritization "fanciful," and Treasury Department Inspector General Eric M. Thorson reported to Congress that the Treasury had no means or capacity to prioritize certain payments over others. Slate economics blogger Matt Yglesias explained that Treasury has "no more legal authority to prioritize payments than they do to borrow extra money."
From the October 3 edition of Fox News' The O'Reilly Factor:
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Mainstream media outlets echoed a deceptive framing, created by the conservative media and amplified by House Republicans, of comments by Senate Majority Leader Harry Reid (D-NV), leaving the false impression that he dismissed the plight of cancer-stricken patients denied care by the government shutdown.
As the government shutdown loomed and then became a reality, right-wing media figures have called for maintained Republican commitment to keeping the government closed until Democrats agree to significant changes to the Affordable Care Act.
Conservative media are selectively and deceptively quoting from an exchange between CNN's Dana Bash Senate and Majority Leader Harry Reid (D-NV) to make it appear as if he dismissed the plight of cancer-stricken children being denied access to clinical trials due to the shutdown of the federal government. In fact, Reid said that legislators should fully fund the government, rather than force different groups to fight over funding.
Specifically, conservatives are claiming that Reid replied to a reporter's question, "If you can help one child with cancer, why wouldn't you?" by saying "why would we want to do that?" In fact, Reid was responding to Sen. Chuck Schumer, who had interjected, saying "why pit one against the other?"
On October 1, the federal government was shut down after conservative Republicans refused to pass legislation funding operations unless that funding was tied to the defunding or delay of Obamacare. As part of an effort to avoid political damage from that unpopular decision, House Republicans have called for piecemeal bills that would fund some parts of the federal government, including the National Institutes of Health and national parks.
Fox News misleadingly claimed Senate Democrats were to blame for the government shutdown, ignoring the role Republicans in the House and Senate have played in refusing to negotiate over government funding.
On the October 2 Fox & Friends, co-host Steve Doocy attacked Senate Democrats for not showing up to a Republican photo opportunity, in which congressional Republicans including Sen. Paul Ryan (R-WI) and Rep. Eric Cantor (R-VA) sat on one side of a table facing empty chairs. Doocy claimed, "none of the Democrats showed up to try to resolve the Senate shutdown":
Fox also hyped an October 1 tweet from House Majority Leader Cantor that claimed that House Republicans were "ready to negotiate with the Senate," criticizing the Senate Democrats in an on-screen graphic for leaving House Republicans "alone at table to compromise."
But House Republicans' October 1 offer to negotiate was little more than a photo opportunity since, as The New York Times pointed out, they have shown no willingness to back down from their "threat of blackmail." From The New York Times editorial board:
Finally, at the last minute, when there was still time to end the charade with a straightforward spending bill, Mr. Boehner made the most absurd demand of all: an immediate conference committee with the Senate. Suddenly, with less than an hour left, he wanted to set up formal negotiations?
For six months, the Senate has been demanding a conference with the House on the 2014 budget -- talks that might have prevented the impasse in the first place. But the House leadership has adamantly refused, knowing it would not succeed in getting all the cuts to taxes and spending that it demands. For Mr. Boehner to call for a conference near midnight was the height of hypocrisy.
Having let down the public, Republicans will now, inevitably, scramble to save their reputation. They are desperate to make it appear as if President Obama and the Democrats are the ones being intransigent, hoping voters will think that everyone is at fault and simply blame "Washington." Mr. Boehner even mocked the president on Monday for refusing to negotiate over health reform, as if he actually expected Mr. Obama to join in wrecking a law that will provide health coverage to millions of uninsured Americans under threat of blackmail.
Fox's newest attempt to blame Senate Democrats for the government shutdown ignores that the controversy is the result of an unprecedented effort by House Republicans to demand concessions in exchange for doing their job. As USA Today noted, the GOP's demands "are both preposterous and largely unrelated to budgetary matters" and "[n]o president of either party could accept that kind of badgering. No president should."
Though the media has repeatedly presented a false equivalence between the House Republicans and Senate Democrats' actions in advance of the shutdown, attempts to shift the full weight of the blame away from the GOP ignores the fact that threatening to shut down the government in order to repeal duly-passed legislation is a "dramatic break from the past." In New York magazine, Jonathan Chait highlighted the importance of remembering that "one party is pursuing this as a conscious strategy." The Huffington Post's Dan Froomkin also reported that congressional experts and historians agree that "[e]ven compared to the famous government shutdowns of 1995 and 1996, the current GOP bargaining position is unprecedented in its political extremism":
"It's unheard of to shut the government down because you want to repeal a law," said Tiefer.
"That seems quite beyond the pale," said George Washington University political science professor Sarah Binder.
Former Congressional Research Service and the Library of Congress official Louis Fisher said he was shocked when he saw what he now recognizes as a foreshadowing of today's crisis, when Republican senators refused for two years to confirm Richard Cordray -- or anyone else, for that matter -- to run the Consumer Financial Protection Bureau unless President Obama agreed to change the bureau's structure.
"That is really amazing, to say you're not going to confirm unless the underlying statute is rewritten," Fisher said. "That was breathtaking to me."
"The Republican Party is caught between politics and its responsibility, as a majority party of the House of Representatives, for governance," said [University of Maryland professor of government and politics the Frances] Lee. "Governance always requires disappointing your base."
It's easier when you're in the minority, she said. "The party out of power can take advantage of its lack of responsibility for governing."
Today's GOP "wants to behave like a party that has no power at all, but unfortunately for it, it does," she said. "The politics of defunding Obamacare are great with its base, but it has an institutional role which it cannot evade."
After repeatedly begging Congressional Republicans to continue the federal government shutdown, Sean Hannity is ratcheting up his expectations. He encouraged conservatives to leave the government inoperable for up to two months if that's what it takes for Democrats to acquiesce to GOP demands -- advice that would carry devastating effects for the American people.
October 1 marked the first day of a federal government shut down, as House Republicans refuse to fund the government unless Democrats and President Obama agree to significant changes to the three-year-old Affordable Care Act (ACA or "Obamacare").
Fox host Sean Hannity has spent the last year begging Republicans to hold America hostage and shut down the government over Obamacare. Now that he's gotten his wish, Hannity is ordering conservatives to keep the government closed, even if it takes "a month or two months." As he told Republican Sen. Rand Paul (KY) on Hannity about the shutdown:
HANNITY: I think the worst outcome, though, for the Republicans in the House at this point -- as they have been reasonable and the president totally unreasonable, Reid unreasonable -- is to cave. I don't think they should give in at all. And if that means that they're going to sit this out for a month or two months, or however long the president wants to be arrogant and not talk to anybody, then just sit it out.
The effects of a protracted government shutdown would be catastrophic.
After only two or three weeks, veterans' disability claims and pension payments to approximately 3.6 million veterans likely won't be paid.
Funding for the Women, Infants, and Children program (WIC), which gives grants to states for low-income pregnant women, new mothers, and infants, will run dry after one week of a shutdown. WIC, which serves 53 percent of all babies born in the U.S. has contingency funds are available, but they will be exhausted by the end of the month.
Food stamps, now called the Supplemental Nutrition Assistance Program, will run out of money to operate by the end of October if the shutdown is ongoing.
Importantly, this damage would pile on top of the chaos the shutdown immediately caused. After House Republicans forced the government to close, over 800,000 federal workers were furloughed and may not receive pay. National parks and landmarks closed. Many home loans no longer processed and economic growth will slow. The Center for Disease Control will cease some disease-prevention programs and most of the Food and Drug Administration's food-safety operations will end.
Unsurprisingly, Hannity is unconcerned by this impact, as it "doesn't impact [him] mentally."
Fox News greeted the opening of the Affordable Care Act (ACA) exchanges on October 1 with lies about the law. Contrary to Fox guest and serial health care misinformer Betsy McCaughey's claims, Congress does not get a "special subsidy" for health insurance, the law does not cut Medicare benefits, and plans offered on the exchanges will provide a variety of benefits.
Fox News' Sean Hannity repeated the recent Fox talking point that President Obama was willing to negotiate with Iran, Syria, and other foreign actors, but refused to even speak with Republican members of Congress. In fact, the president has repeatedly emphasized his willingness to negotiate and recently spoke with Speaker of the House John Boehner (R-OH) and other congressional leaders.
On the September 30 edition of Hannity, host Sean Hannity asked his guest. U.S. Sen. Lindsey Graham (R-SC), about the President's willingness to work with Republicans to avoid a looming government shutdown over GOP efforts to defund the Affordable Care Act. Hannity said, "The president will talk to Syria, Iran, Vladimir Putin, but he won't talk to members of the House of Representatives or the U.S. Senate. Do I have that right?" Graham responded, "You got it right."
Hannity claimed Obama was unwilling to even "talk" with Republicans in Congress. In reality, Obama called Speaker Boehner and other GOP leaders earlier today. According to Reuters:
President Barack Obama urged House of Representatives Speaker John Boehner on Monday to back legislation to fund the government for six weeks and to vote on it quickly to avoid a government shutdown in hours.
The White House said Obama, in a phone call to the top Republican in Congress, asked Boehner to drop House Republican attempts to tie continued funding of the government to cutting money for Obama's signature healthcare law, the central obstacle holding up an agreement.
Despite Hannity's claim, Obama's call to congressional leaders was even reported in his show's on-screen text:
And though the text describes the news as "Breaking News," Reuters reported on the call over an hour before Hannity aired.
OBAMA: I'm always willing to work with anyone of either party to make sure the Affordable Care Act works better, to make sure our government works better. I'm always willing to work with anyone to grow our economy faster, or to create new jobs faster, to get our fiscal house in order for the long run. I've demonstrated this time and time again, oftentimes to the consternation of my own party.
Weekly Standard's Bill Kristol praised Republican efforts to force congressional staffers to foot the entire cost of their health care coverage under the Affordable Care Act (ACA or "Obamacare"), pretending any subsides Congressional staffers receive from their employer would be tantamount to "special treatment."
With the deadline to avoid a federal government shutdown looming, Republican Senator David Vitter (LA) proposed an amendment to the spending bill that would fund the government and avoid a shutdown. His proposal, passed by the House on a 228 - 201 vote, eliminates health care subsidies members of Congress and their staff will receive from their employer, the federal government, to help pay the cost of their coverage under the Obamacare exchanges.
Weekly Standard editor Bill Kristol praised the plan as an "extremely strong, political, and substantive" provision during an appearance on the September 30 edition of Fox News' Special Report. Discussing the possibility of a government shutdown, Kristol claimed:
KRISTOL: This is the best political ground for them to fight on ... They are getting rid of the exemption -- the special treatment for congressmen who get special treatment -- better than that of anyone else who's forced into the exchanges.
When host Bret Baier pointed out that even some Republican congressmen disagreed with the measure because they "don't think that their staff should have to feel the pain here," Kristol doubled down:
KRISTOL: I think the House Republicans are intelligent to insist on it, to prevent the Obama administration's change of it and to say, 'I'm sorry, there's no reason Congress or their staffs, nice people though they are, should get a better break than all the other Americans who are being forced into the exchanges under Obamacare.'
The "better break" Kristol cites is actually a special punishment targeted at congressional staff members, a punishment Vitter and House Republicans are fighting to continue.
From the September 27 edition of Premiere Radio Networks' The Rush Limbaugh Show:
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From the September 26 edition of Cumulus Radio Networks' The Mark Levin Show:
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Following a 21 hour fake filibuster by Senator Ted Cruz (R-TX), right-wing media figures were quick to praise the effort as "genius." Fox host Sean Hannity opened his September 25 show, Hannity, with an over-the-top montage of Sen. Cruz's filibuster alongside images of Gadsden flags, American flags, trains, and Americans getting their hair cut, while conservative radio host Bill Cunningham compared Cruz to Davy Crockett, James Bowie, and John Wayne:
Republican Sen. Ted Cruz's (TX) speech on the floor of the Senate was the culmination of a several-month campaign to convince his congressional colleagues to vote against any appropriations bill that does not defund Obamacare, which gained the support of a host of right-wing talk radio figures such as Sean Hannity, Laura Ingraham, Erick Erickson, and Rush Limbaugh.
After Cruz spent 21 hours pleading for Republicans and Democrats to vote against cloture, the motion passed unanimously with the acquiescence of Cruz himself.
Several years ago, it was expected these talkers would have cowed the Republican Conference to their whim. Today, Sean Hannity is supportive of Cruz but other elements of the conservative movement remain divided. Fox News contributor Karl Rove has used his media platform to make arguments for avoiding this fight, while fellow contributor Sarah Palin has attacked Fox News Sunday host Chris Wallace, demanding he "release the GOP names encouraging you to trash [Ted Cruz.]"
Since Rush Limbaugh's radio program went into syndication in August of 1988, talk radio has held unprecedented power over the GOP, wreaking vengeance on those who defied it. Erick Erickson recently cited conservative anger at George H.W. Bush for violating his "no new taxes" pledge as the reason for his defeat in 1992.
The age of talk radio has not been kind to the Republican Party's national candidates who have failed to capture a plurality of the popular vote in five of seven elections since Limbaugh's program went national. (In fact, one of those elections was Bush's 1988 victory, which, in reality, occurred before his influence reached its apex.)
Conservative talk radio is good for its hosts' bottom lines because it captures the loyalty, dedication, and financial muscle of a large niche audience. This can amount to millions of listeners, hundreds of millions of dollars, but still represents a limited quantity of voters -- far less than the 50 percent it takes to win an election.
Politicians like Cruz recognize the power of that niche in building his brand within the Republican Party.
Cruz also recognizes the financial benefit long known by the talk radio hosts raising millions of dollars off of a stunt that threatens to do billions of dollars in damage to the economy. It's important to recognize, however, that even the majority of Republicans oppose Cruz's tactic.
Instead of rallying in support or cowering in fear, Cruz's GOP colleagues in the Senate are bucking the conservative radio base for fear of being replaced in the primaries.
In addition to failing to unite behind Cruz's campaign, Fox recently announced its decision to downgrade the position of its talk radio star Hannity from his prime location at 9 p.m. to the less desirable 10 p.m. timeslot. This moves makes way for Megyn Kelly who, while maintaining the network's conservative ethos, delivers a far different product than her conservative counterparts.
It is perhaps heartening that after nearly 25 years of right-wing talking heads dragging the Republican Party away from a place where it can constructively engage with its counterparts, the Senate Republican Conference has briefly broken free of talk radio's grip.
It remains to be seen if this a long-term trend or a short-term realignment. But for once, the calculation that what is good for Rush Limbaugh and Sean Hannity and now Ted Cruz is often to the detriment of the broader Republican Party has been heeded at this time by its leaders in the United States Senate.
Sen. Ted Cruz (R-TX) (joined by a coterie of Senate Republicans) spoke on the Senate floor for about 21 hours in opposition to funding the Affordable Care Act, or "Obamacare." Cruz's speech was not a filibuster, it had to end before today's scheduled vote on the Senate's bill to continue funding the government, and was never a threat to derail legislation that was passed and signed into law three years ago.
As such, much of the media coverage of Cruz's speech has focused on the political circus Cruz has whipped up. Since he couldn't actually alter the legislative process and has few supporters on either side of the aisle, it's not unreasonable to think that Cruz is doing this for his own benefit. Washington Examiner political writer Timothy Carney has sensed this tone in the media coverage of Cruz's fake filibuster and sounds the familiar "LIBERAL BIAS" klaxon, arguing that Texas state senator Wendy Davis' (D) filibuster to halt passage of a restrictive anti-abortion rights bill this past summer was similar to Cruz's but "the media spin was different."
The circumstances surrounding Cruz's and Davis' speeches, however, are pretty different. "Davis's filibuster was no more likely than Cruz's to change the law," Carney wrote. Perhaps so, but Davis' filibuster was an extraordinary measure taken in response to extraordinary measures deployed by Gov. Rick Perry and the Republican-dominated legislature. Davis' filibuster came at the end of a special legislative session convened by Perry specifically to pass the abortion law, and after it failed to pass Perry had to call yet another special session to pass the bill, and a third after that to deal with the business the legislature couldn't attend to because it was wrapped up in the abortion debate. Cruz was operating within the regular business of the Senate and there was a hard deadline on how long he could continue.
Politically, Davis' filibuster became a flashpoint in the national abortion debate because it split activists along the well-established lines, and abortion rights supporters worked doggedly to elevate Davis' profile while opponents worked to marginalize her. It also helped to highlight the intense state-level fights over abortion rights that had not registered on the national media's radar. With Cruz, that dynamic doesn't exist. He has a few supporters in the Senate, and most Republicans -- including Senate Minority Leader Mitch McConnell and Minority Whip John Cornyn -- aren't backing him. Even the Wall Street Journal editorial board dismissed his anti-Obamacare campaign with more than a whiff of contempt: "The supposedly intrepid General Cruz can view the battle from the comfort of HQ while the enlisted troops take any casualties."
And Cruz is relitigating a fight that has long since been resolved. Most of the country already knows of and has an opinion of Obamacare. It was a central theme of the 2012 election and the guy who was for it won easily. The only thing Ted Cruz has brought to the table is Ted Cruz. Steve Benen put it just right: "Cruz seems to be generating quite a few headlines for himself. But as a qualitative matter, was Davis' speech a more important, consequential, and impressive display? I don't consider it a close call."