Paul Ryan Has A Message-- Or A Ransom Note-- From His Crooked Pals On Wall Street

Wall Street and Big Insurance have poured more cash into Paul Ryan's political career than into any other Wisconsin politician in history. They recognized something in him early on and kept the money rolling in. And he's delivered-- even to the point of grasping the third rail of middle class entitlements that other Republicans were too scared (or too smart... or too poor) to run with. The ruling elite wants to abolish Social Security and Medicare. In Ryan they found their man.

So when Ryan stood up Tuesday and told CNBC that a debt default was ok with his bosses on Wall Street it was something worth paying attention to-- even more so than Miss McConnell's and Boehner's bluster. Ryan says that "the investors he talks to could apparently care less about the country failing to pay its short-term debts, for a little while at least." This is DeMint's and Limbaugh's "I want Obama to fail" on steroids. These guys are willing to bring down the whole country-- maybe the whole world-- to screw up Obama. It's a new low in American political history-- a very, very dangerous new low.

Ryan told the network that he talks to "lots of bond traders" and "lots of economists" and they all say that investors are willing to put up with a default of "a day or two or three or four" if it produced massive budget changes as part of a Capitol Hill debt limit deal.

"They all say, 'whatever you do, make sure you get real spending cuts,'" Ryan said. "Because you want to make sure that the bond-holder has the confidence that the government's going to be able to pay them. You're putting the government in a better position to pay them."

Stan Collender, a veteran of many Capitol Hill budget fights and a budget policy expert, said talk that that could be very dangerous.

"There's obviously no way to know for sure because we've never really been in that situation," he said. "But it's far more likely that there would be relatively immediate negative repercussions in financial markets if there was even a hint of bond holders not being paid."

He explained:

The problem would be the virtually immediate lost confidence in the political system's willingness to raise the debt ceiling to meet existing obligations. While some investors might be willing to wait, others would sell just to eliminate the risk. That could easily start a financial panic.

Collender also rejected Ryan's idea of a three-day default as "ridiculous." If Congress did make a deal on the debt limit before the Aug. 2 deadline, they'd pass it quickly and make sure to cover all the time the kinks were being worked out with short-term increases, much as it did during the government shutdown battle last month.

But "if there was no deal," Collender said, the short default Ryan's talking about "wouldn't make any difference because few would assume that, after months of talk, something would happen 3 days later."

As Krugman has been warning all year, Ryan has nothing serious worth listening to when it comes to financial matters.

So Paul Ryan gave his big speech defending his plan — and demonstrated, in case you were wondering, that there’s no there there (and there never was).

Remember how everyone declared that Ryan was a serious person, truly willing to face up to our deficit problem? Well, now he’s out there denouncing the way “the budget debate has degenerated into a game of green-eyeshade arithmetic”-- in other words, enough with all these numbers. And his answer to the deficit now is that we have to grow our way out.
There’s a name for that: voodoo economics.

And in fact almost his whole speech was standard supply-side boilerplate. Low taxes are the secret to growth, nobody ever solved a deficit problem by raising taxes (Clinton, anyone?). He even denounced austerity. The only original things he had to say, if you can call them that, involved health care costs and monetary policy.

On health care costs, he declared that “Our plan is to give seniors the power to deny business to inefficient providers.” Remember, what the plan actually does is hand out vouchers whose value will fall well short of the cost of coverage. So how much power do those Americans who can’t afford decent health insurance have right now in their dealings with providers? If you think people who don’t get coverage through their employers have the upper hand, you believe that the Ryan plan is empowering.

And then there’s the claim that hard money is the key to growth. Milton Friedman turned over in his grave.

Basically, again, what we’re getting here is standard right-wing voodoo. Ryan turns out to be an empty suit, parroting the usual line. What’s remarkable is that for a year or so this empty suit was hailed-- by self-proclaimed centrists as well as the right-- as a brilliant, brave champion of fiscal responsibility.

There's a reason why Newt Gingrich called his "radical" budget "right-wing social engineering." His Democratic opponent next year, Rob Zerban says Ryan is out of touch with Wisconsin voters. "Wisconsin families deserve a voice in Congress who will put them first instead of engineering a plan to gut Medicare and sell out our families to Washington special interests like Big Oil... If Newt Gingrich thinks Ryan's plan is too radical, it's outrageous to think that this is the right track for Wisconsin. As someone who has run a successful small business, I know how to create jobs and grow a strong local economy. We need to focus on how to drive Wisconsin forward and not set back our families and seniors by ending Medicare."

Please help Rob Stop Paul Ryan... before it's too late. Ryan may not be worth taking seriously in fiscal policy matters but in politics, he's as serious as a heart attack.