Thursday, April 7, 2011

Forget The Budget, The Real Nightmare Comes Next Month, And The Stakes Are 1000x As High

poker chips bet
article by: Joe Weisenthal

A point that needs to be made: This fight over whether to shut down the government for a few days is chicken-scratch.

It's low-stakes poker compared to the fight over the debt ceiling, which must be resolved by May 8, in just over a month.

Several GOPers have already said they won't raise it without some "significant" concessions from The White House on the future of spending, and whatever good will John Boehner has to burn up in getting a budget passed will be taken directly from the appetite the GOP had in raising the debt ceiling.

The consequences are way more severe, potentially, than the shutdown of government. At the most extreme, it could lead to default. And if you figure that the market goes into a tizzy at the suggestion of, say, Greece defaulting, then the impact of the US should be easy to comprehend.

There's no doubt that Boehner doesn't want a disastrous outcome, but his challenge is in getting his more radical compatriots to come along with him.

So enjoy the theater of what we're seeing now. It's just the opening band.[id]=37&width=90

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