Team O's absurd default talk

I've lost count of how many times President Obama and Treasury Secretary Tim Geithner have said over the last three days that America might default if the debt-ceiling impasse continues. For the good of the country, let's hope the markets have forgotten as well.

It's hard to see how Obama, Geithner or White House Chief of Staff Bill Daley could have had the good of the country in mind as they made the rounds of the Sunday talk shows -- spreading dire predictions about default if the debt ceiling isn't raised in the fashion that they and their Democratic allies believe appropriate.

Out to scare the markets? President Obama's and Secretary Geithner's "warnings" risk economic disaster.
For all their apocalyptic talk, they're still demanding a budget deal filled with jobs-killing taxes, even as unemployment remains north of 9 percent.

OK, a default would be a disaster. A US failure to pay bond holders could tank the Dow and upend the bond markets, where companies borrow to finance everything from plant and equipment to employee salaries.

Credit cards might not work because banks won't have access to borrowed money to lend to consumers. Forget about getting a loan to buy a house or a car.

In other words, the economy could come to a halt.
But there's no reason for default even if there's never a debt-ceiling hike.

Even if Congress and the president remain deadlocked past the Aug. 2 deadline, when the feds are supposed to run out of money to pay all their bills, a default still leaves them with plenty of cash to pay the most important ones.


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