Remember Joe Sestak's commercials hitting Pat Toomey for supporting trade deals with China, complete with the sound of banging gongs?
Senate Democrats and the White House are doing the same kind of thing with the freshman Senator's legislation calling for the U.S. to pay down interest first if the nation's debt ceiling is not raised, calling it a "pay China first" plan.
If passed, Toomey's plan would require the government to cut large checks to foreign countries, and major financial institutions, before paying off its obligations to Social Security beneficiaries and other citizens owed money by the Treasury -- that is, if the U.S. hits its debt ceiling. Republican leaders insist they will raise the country's debt limit before this happens. But first, they're going to try to force Democrats to accept large spending cuts, using the debt limit as leverage. That means gridlock, and the threat that they'll come up short
And yet, according to the Treasury Department, Toomey's idea wouldn't actually avoid a default, or its catastrophic consequences.
"[T]his idea is unworkable," said Deputy Treasury Secretary Neal Wolin in a statement. "It would not actually prevent default, since it would seek to protect only principal and interest payments, and not other legal obligations of the U.S., from non-payment. Adopting a policy that payments to investors should take precedence over other U.S. legal obligations would merely be default by another name, since the world would recognize it as a failure by the U.S. to stand behind its commitments."
. . . "I think it is a dreadful idea," Sen. Kent Conrad (D-ND) told National Journal. "Basically what they are saying is, pay China first. Are we going to forget about the American public and the things that they need? Somehow they are secondary? And paying the Chinese and the Japanese is the first priority of this country? I don't even know how to describe that idea; it's just a very, very bad one."
Photo: Gong-master Alex Van Halen. ClassicVanHalen.com.