Brian Beutler on President’s Obama’s debt ceiling press conference:
“If Congressional Republicans refuse to pay America’s bills on time, Social Security checks, veterans benefits will be delayed,” Obama warned. “We might not be able to pay our troops or honor our contracts with small-business owners. Food inspectors, air traffic controllers, specialists who track down loose nuclear materials would not get their paychecks. Investors around the world will ask if the United States of America is in fact a safe bet. Markets could go haywire. Interest rates would spike for anyone who borrowed money.”
The specter of an enormous wave of missed payments to powerful stakeholders — and possibly a default on the debt — will, the Obama administration believes, create enormous pressure on House Republicans to drop their demands and raise the debt limit cleanly, or in an uncontroversial way.
But that risk only exists if the White House lacks plausible, less economically harmful alternatives, such as continuing to issue new debt in defiance of the law, or minting currency to pay obligations without issuing new debt — two options the administration has explicitly rejected.
Now that the Coin and the 14th amendment workarounds are off the table, there are only two options: clean debt ceiling increase or default. How soon will the Republicans cave?