Michele Bachmann: Still A Debt Kamikaze, Still Completely Wrong

Michele Bachmann is claiming that the debt downgrade proves she was right about not raising the debt ceiling.

Slate’s David Weigel reports that Michele Bachmann is still convinced that she was right about not raising the debt ceiling, and she bizarrely points to the decision by S&P to downgrade the nation’s credit rating as proof she was right:

Michele Bachmann wants Iowa to know that she was right all along.

“I went back to Washington not once, not twice, not three times—I went back to Washington four times to vote ‘no’ on raising the debt ceiling!” she says.

There are more than 70 people listening to this message. It’s hot. She ran a little late. Some of them volunteered to sit to Bachmann’s left or right to hold signs behind her, but most are in the shade. They’re not reacting or applauding yet.

“What we saw last week is the markets agreed with me,” says Bachmann. “The markets saw what happened in Washington when Obama got a $2.4 trillion check. And one thing you learned is you can’t fool the markets! The politicians were busy applauding themselves! They were patting each other on the back! They were saying, ‘Didn’t we do a great job! We just raised the debt ceiling!’ How did that make you feel?”

(….)

The winning argument, the one she keeps returning to, is the saga of Michele and the Debt Limit. She followed her instincts. Iowa Republicans shared those instincts. They were right, and the elitists were wrong. (When aren’t they wrong?) They promised that if the debt limit got hiked, rating agencies would go back to sleep. They didn’t. Standard & Poor’s lowered America’s bond rating from AAA to AA+.

“It was lowered for the first time in American history!” says Bachmann. “We kept that rating during the Great Depression. We kept it during World War II. We kept it during Vietnam. We kept it after nine-one-one.” (This is how Bachmann pronounces 9/11.)

And the people who went to hear her speak in Council Bluffs, Iowa were buying it:

Spending cuts or no, the debt limit “never should have been raised,” sighs Anita Cote, who’s come to the rally with her husband. A few years back they sold their clothing store and retired, and they had been doing well, but they have friends who aren’t thriving. They see the spending coming out of Washington and identify a culprit. “You’d never run a business that way, and the people didn’t want it to be raised.”

Of course, Bachmann is completely mis-representing what S&P said when it released its report lowering our credit rating on Friday evening, especially with regard to the debt ceiling. First, it’s absolutely essential to note that Standard & Poor’s did not cite raising the debt ceiling as a factor that at all weighed in their decision to downgrade American debt. Instead, this is what they actually said:

We lowered our long-term rating on the U.S. because we believe that the prolonged controversy over raising the statutory debt ceiling and the related fiscal policy debate indicate that further near-term progress containing the growth in public spending, especially on entitlements, or on reaching an agreement on raising revenues is less likely than we previously assumed and will remain a contentious and fitful process. We also believe that the fiscal consolidation plan that Congress and the Administration agreed to this week
falls short of the amount that we believe is necessary to stabilize the general government debt burden by the middle of the decade.

Our lowering of the rating was prompted by our view on the rising public debt burden and our perception of greater policymaking uncertainty, consistent with our criteria (see “Sovereign Government Rating Methodology and Assumptions” June 30, 2011, especially Paragraphs 36-41). Nevertheless, we view the U.S. federal government’s other economic, external, and monetary credit attributes, which form the basis for the sovereign rating, as broadly unchanged.

(…)

The political brinksmanship of recent months highlights what we see as America’s governance and policymaking becoming less stable, less effective, and less predictable than what we previously believed. The statutory debt ceiling and the threat of default have become political bargaining chips in the debate over fiscal policy. Despite this year’s wide-ranging debate, in our view, the differences between political parties have proven to be extraordinarily difficult to bridge, and, as we see it, the resulting agreement fell well short of the comprehensive fiscal consolidation program that some proponents had envisaged until quite recently. Republicans and Democrats have only been able to agree to relatively modest savings on discretionary spending while delegating to the Select Committee decisions on more comprehensive measures. It appears that for now, new revenues have dropped down on the menu of policy options. In addition, the plan envisions only minor policy changes on Medicare and little change in other entitlements, the containment of which we and most other independent observers regard as key to long-term fiscal sustainability.

In other words, it wasn’t the fact that we raised the debt ceiling that was the problem as S&P saw it, it was the fact that it took us six weeks of mostly pointless negotiation to do it, with a final deal at the last minute that didn’t even meet the recommendations that they had made back in April. Moreover, while they don’t mention it specifically, one could argue that the manner in which the deal cuts spending in the future is part of the uncertainty and lack of predictability that the report talks about. You can criticize S&P for their conclusion that these political factors justified a lowering of the debt rating, and many have. However, it’s fairly clear that the reasoning behind that decision had nothing to do with the fact that we raised the debt ceiling, and everything to do with the policy uncertainty that people like Michele Bachmann created with their insane idea that we don’t need to raise the debt ceiling at all.

In fact, it’s fairly clear that following Bachmann’s advice would have been disastrous for the United States. Moody’s warned back in June that failure to raise the debt ceiling would put the AAA credit rating in danger. A former economic adviser to George W. Bush said that failure to raise the debt ceiling would result in an immediate 40% cut to Federal Spending, and Mark Zandi, who has advised the President, said that it would lead to another recession. Zandi’s prediction didn’t seem that far off given the extent to which an immediate 40% reduction in spending would impact private business across a wide swath of the economy. Moreover, failure to raise the debt ceiling would also likely have had a negative impact on the budgets of nearly every state, and many large localities.

It’s easy for Bachmann to sit back now and claim that if we’d only listen to her things would be better, because nobody is ever going to be able to prove her wrong to the satisfaction of her fanatical supporters. Nonetheless, it’s fairly clear that she was among the more irresponsible members of the Tea Party Caucus throughout the whole debt ceiling debate. If her GOP opponents had any guts, they’d call her out for it.

Photo via The Blaze

FILED UNDER: Campaign 2012, Congress, Deficit and Debt, Economics and Business, US Politics,
Doug Mataconis
About Doug Mataconis
Doug holds a B.A. in Political Science from Rutgers University and J.D. from George Mason University School of Law. He joined the staff of OTB in May 2010 and contributed a staggering 16,483 posts before his retirement in January 2020.

Comments

  1. john personna says:

    However, it’s fairly clear that the reasoning behind that decision had nothing to do with the fact that we raised the debt ceiling, and everything to do with the policy uncertainty that people like Michele Bachmann created with their insane idea that we don’t need to raise the debt ceiling at all.

    It’s uncertainty, but also the lack of a credible debt-reduction plan. Even Moody’s, who retains AAA, says they do so because they think we’ll figure it out in the next 10 years. Not because they see a solution in place now.

  2. Falze says:

    Using a Japanese term doesn’t make calling someone you politically oppose a suicide bomber any more classy.

    Typical.

  3. Gustopher says:

    Both sides are to blame. This is a failure of comprehensive education, which left Bachmann so darned ignorant, and everyone knows teachers are liberals.

    Ultimately, though, even though the Republicans must share a sliver of blame, the Teachers Unions are to blame. By not allowing accountability for teachers, the obvious result staggering ignorance in Representatives 30 years later.

  4. mantis says:

    This is a failure of comprehensive education, which left Bachmann so darned ignorant, and everyone knows teachers are liberals.

    Not where Bachmann went to school!

  5. john personna says:

    @Falze:

    Really, what part of the debt drama and non-solution did you miss?

  6. Peterh says:

    By not allowing accountability for teachers, the obvious result staggering ignorance in Representatives 30 years later.

    You can lead a horse to water, but you can’t make it drink……

  7. hey norm says:

    it will all be better when Perry/Palin run things.

  8. Moosebreath says:

    “You can lead a horse to water, but you can’t make it drink…… ”

    Or as Dorothy Parker said (and I am by no means casting aspersions on any specific person by quoting this), “You can lead a horticulture, but you can’t make her think.”

  9. Gulliver says:

    And the geniuses who jumped us off the cliff into an empty pool of Keynesian economics are ever so much smarter. Raising the debt ceiling exacerbated the problem, it didn’t alleviate it. What part of S & Ps statement about our lack of action in addressing our long term debt do liberals not understand?

    Not to mention the fact that the current way we handle entitlements – and their negative impact on long term debt – were specifically mentioned as THE main problem in the downgrade report and – guess what? – Obama’s signature legislation is a massive brand- spankity new entitlement program called Obamacare. Now that sure helped the problem didn’t it? Get a clue. Bachmann isn’t the President, and she didn’t make the extremely poor choices that added a Trillion dollars to our deficit in two years.

    Someday the liberals and Mataconis will actually face up to the fact that your policies have failed – utterly. You conveniently forget that Obama and Bernanke have both stated publicly that the current debt levels are unsustainable. And all the libs can say is “tax the rich” their “fair share.”

    After all, it’s much more important to propagandize about “someone else” being to blame than it is to man up and admit that you f’n blew it on a cosmic scale.

  10. Scott F. says:

    And the people who went to hear her speak in Council Bluffs, Iowa were buying it

    This is the problem.

  11. David M says:

    Taking the position that the debt limit should not have been raised under any circumstances would hopefully disqualify that person from ever holding elected office again. It’s an incredibly radical proposal as there is nothing conservative about what the results would be. I’m assuming she ruled out tax increases, so I feel it’s a fair characterization to say she’s advocating a 40% cut across the board, including Social Security, Medicare and Defense.

  12. ponce says:

    It’s clear there is a large segment of Republicans who want their politicians to lie to them.

    Who better to do it than a hypocrite like Bachmann who has been suckling at the government teat since the day she was born…

  13. Is it bad that I’m nearly at the point of hoping they don’t raise the ceiling the next time, because an economic diaster is worth it if it will shut Bachmann up?

  14. Moosebreath says:

    Stormy,

    You’re not bad, but it would never work. Instead, you would have the Bachmanns of the world saying that the economic disaster is only a disaster since it was handled wrongly, and if they ran it, it would be unicorns for all. Something like the way diehard Marxists believe Communism would succeed if it were ever properly tried, or how bithead thinks that if a True Conservative would ever get nominated, he/she will win in a landslide.

  15. sam says:

    @Gulliver:

    Bachmann isn’t the President, and she didn’t make the extremely poor choices that added a Trillion dollars to our deficit in two years.

    If that is to be taken as asserting she has not contributed, in a big way (well, big for most of us), to the deficit we face, then as a matter of fact, that’s bullshit.

    Bachmann’s farm income, according to Bachmann’s disclosures

    The Los Angeles times did a lengthy takeout on Michele Bachmann’s income from government and farm subsidies, a piece that prompted questions from Fox News Sunday host Chris Wallace during the congresswoman’s announcement-eve appearance today.

    Bachmann insisted that the family farm in question never profited her direct family.

    “Number two, regarding the farm, the farm is my father-in-law’s farm. It’s not my husband and my farm. It’s my father-in-law’s farm. And my husband and I have never gotten a penny of money from the farm,” Bachmann said.

    But her financial disclosures in 2009 and 2010 show her getting between $15,000 and $50,000 from the Bachmann Family Farm LP.

    The farm got north of $250,000 in government subsidies, according to reports.

    So, not only has she had her nose in the federal deficit trough, she’s lies about it. And then there’re the gubmint bucks that go to hubby’s pray-away-the-gay scamatoriums

    Really, you guys deserve these grifters, the rest of us don’t.

  16. David M says:

    @Gulliver: The ACA is projected to lower the deficit, so it’s a pretty safe bet that wasn’t what the S&P report was referring to. Although, it does seem an appropriate thing to bring up, as Bachmann does support increasing the deficit and repealing the ACA.

  17. john personna says:

    @Gulliver:

    You hit some points I’d agree with, but your overall story arc misses, from my moderate perspective.

    The debt limit increase was necessary from a strict accounting standpoint. It needed to be done to successfully close past accounts. And, looking forward, I don’t see the liberals trying for much. They are not trying to expand education, healthcare, homeless care, or whatever.

    No, even the liberals are proposing cuts. They just want to pair them with tax increases. That’s something I see as necessary as well.

    Just because the math doesn’t work any other way.

  18. john personna says:

    Modern Dictionary:

    Socialist -1) someone who only wants to reduce government slowly. 2) someone who wants to reduce government more slowly than you do.

  19. Eric Florack says:

    First off, let’s be honest enough to remind ourselves that we got into this situation by go-along to get-along “centrist” politics. Secondly, let’s also be honest enough to recognize we got here by listening to the supposed experts and their wisdom. Those two points made, let’s examine this argument of yours, Doug;

    In fact, it’s fairly clear that following Bachmann’s advice would have been disastrous for the United States. Moody’s warned back in June that failure to raise the debt ceiling would put the AAA credit rating in danger.

    But we did raise the debt ceiling, and guess what happens? The rating gets lowered anyway. And as to evidence of an economic disaster, an early indicator of such is the price of gold, which has been skyrocketing of late. And of course the inflation be damned, they’re now talking about simply printing money, as I suggested they would. Indeed, everything that Bachman’s now-naysayers warned us would happen, happened anyway, despite… and quite probably because, of taking their advice.

    Finally, please note that it was Standard & Poor’s, four years ago, that aided the Democrats cause the recession that we’re now and by providing AAA ratings to subprime mortgages.

    Can it be that Standard & Poor’s has now learned their lesson? I doubt that. Or is is possible, that S&P is acting again at the behest of the Democrats? odd, I think, that nearly nobody else is considering that possibility. Likley runs afoul of their politics.

    But there’s another wrinkle in this sheet: What’s this I hear about Soros making about a billion because S&P downgraded the US? Hmmmmm

  20. john personna says:

    @Eric Florack:

    First off, let’s be honest enough to remind ourselves that we got into this situation by go-along to get-along “centrist” politics.

    BS. It was not centrist to reduce taxes while increasing spending, and it was not centrist to start 2 wars without any current funding.

    I told you then that the wars were 100% debt financed, and there were some conservative nimrods who couldn’t believe it. They said absurd things like “the wars are paid for, it’s the social spending that’s borrowed.” No, social spending was not new and additive spending made without supporting revenue.

  21. ponce says:

    They said absurd things like “the wars are paid for, it’s the social spending that’s borrowed.”

    The current republican party is built on childish lies that they all pretend to believe.

  22. mike says:

    shouldn’t she and her husband be out convincing some gay guy to go straight. really this is one of the top 10 the GOP can put forward at this point?

  23. john personna says:

    Cut taxes and start 2 wars at the same time … what could possibly go wrong?

  24. @Eric Florack:

    But we did raise the debt ceiling, and guess what happens? The rating gets lowered anyway.

    Yeah, we got downgraded to AA+. Prior to the deadline, S&P said if we didn’t raise the debt ceiling, they were going to lower us to Caa3. To put it differently, the bill that passed dropped us from Switzerland to New Zeland. Bachmann’s plan would have dropped us to Ecuador.

  25. A voice from another precinct says:

    @Stormy Dragon: No, your not a bad person for thinking that. After reading Gulliver’s comment, I am even more convinced that Obama should have pulled that trigger THIS time. Of course, Obama wants to be re-elected and I don’t care whether he is or not. Hmmm…is my take on Obama’s re-election bad (considering that “ladies and gentlemen, the President of the United States, Michelle Bachmann” is not beyond the pale)?

  26. sam says:

    Eric Florack, aka Bithead, drops in from time to time to remind us (those who need reminding) that the Tea Party is really The Tea Party.

  27. An Interested Party says:

    But there’s another wrinkle in this sheet: What’s this I hear about Soros making about a billion because S&P downgraded the US? Hmmmmm

    Aha! Of course it was all part of the plan! Someone pass Eric the roll of aluminum foil…

  28. JohnMcC says:

    Mr Florack, you say “the inflation be damned” is the administration’s attitude. And on the day you made that ridiculous statement so many people were willing to buy our debt that the 10 yr Treasury Bond actually amounts to money loaned to the U.S. at ZERO percent. And the 5 yr Bond actually sold for LESS than ZERO. It’s purchasers were paying 0.84% PREMIUM for the privilege of holding the debt of your country for five years.

    I swear that people who hold your convictions remind me of the Birchers in their delusional paranoia. LOOK! A COMMIE! Now it’s LOOK! INFLATION! No logic, no research, no mental balance.

    I’d ask you to show us the inflation but you’d probably point at the hall-tree.

  29. anjin-san says:

    But we did raise the debt ceiling, and guess what happens? The rating gets lowered anyway.

    Gee bit, if you just parrot the words of nutjobs like Bachmann often enough, and vacuum weld your lips to her ass with enough vigor, why one day – one of these folks might even notice you exist. Meantime you can keep a nice fantasy going where you are someone like Sean Hannity who gets to break out his kneepads on TV!

    Yes bit, perhaps one day a crumb will fall off the table of the ruling class and hit you on the head. Then all the years of cravenly repeating this nonsense will have paid off…

  30. anjin-san says:

    LOOK! A COMMIE! Now it’s LOOK! INFLATION

    Don’t forget the ever popular LOOK! A MUSLIM!

  31. Eric Florack says:

    @Stormy Dragon:

    Yeah, we got downgraded to AA+. Prior to the deadline, S&P said if we didn’t raise the debt ceiling, they were going to lower us to Caa3. To put it differently, the bill that passed dropped us from Switzerland to New Zeland. Bachmann’s plan would have dropped us to Ecuador.

    Sounds like Obama claiming that without his putting us in the poor house the jobless rate would have been worse. More “saved” jobs, eh, Stormy?

    Mr Florack, you say “the inflation be damned” is the administration’s attitude. And on the day you made that ridiculous statement so many people were willing to buy our debt that the 10 yr Treasury Bond actually amounts to money loaned to the U.S. at ZERO percent. And the 5 yr Bond actually sold for LESS than ZERO. It’s purchasers were paying 0.84% PREMIUM for the privilege of holding the debt of your country for five years.

    Have you actually looked at who is buying them?

    BS. It was not centrist to reduce taxes while increasing spending, and it was not centrist to start 2 wars without any current funding.

    In fact, that is the centrist position. A combo of the Democrats never cutting ANY spending, and the Republicans recognizing that raising taxes would kill the economy.

  32. OzarkHillbilly says:

    So much stupid in one thread. If you know me you know which stupid I mean. Sorry guys, worked the past 3 days for the 1st time since May, and the heat has kicked my a**. Maybe next week I can participate (got laid off today)