Home > Deficit > Countdown to Deficit Cuts – But Still a Deficit: UPDATE II

Countdown to Deficit Cuts – But Still a Deficit: UPDATE II

July 13th, 2011
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07.13.2011 UPDATE II

Countdown to Deficit Cuts – But Still a Deficit: Update II

original article written by Net Advisor

Reader Note: This article is a 5-part series that began HERE. We have moved the update to this page. This is Update II of our Countdown to Deficit Cuts article series.

President Obama abruptly walked out of deficit talks.
President Obama was apparently upset with House Majority Leader Eric Cantor (R-VA). Cantor reportedly made statements that the debate over the debt issues between the major political parties were “too far apart.” The parties are attempting to come to an agreement over how much to raise the deficit, whether new taxes are raised and by how much, what if any spending cuts will Congress make, and who will end up paying for all this?

Mr. Obama seemed to be condescending and began to “lecture” Cantor, and stormed out of the meeting. A Democratic aide reportedly said that Cantor was directly talking to the President instead of using his aides. The Democratic aid also said that Cantor was “interrupting” Obama. Cantor stated that he did not interrupt the President, and was seeking permission to speak to him. The Democratic aid refereed to Cantor as exhibiting “juvenile behavior,” and that the Speaker (Boehner) “needs to rein him in, and let the grown-ups get to work” (Source: Politico).

Moody’s Warns of Downgrading U.S. Credit Rating
After the U.S. stock market closed, credit rating agency Moody’s warned again that it may downgrade the U.S.’s bond rating from AAA to AA range if the deficit ceiling issues are not solved by August 2, 2011 (Sources: MarketWatch, Fox News). Moody’s made a prior U.S. credit warning announcement on June 3, 2011 (Source: The Guardian.UK). Standard and Poor’s warned of U.S. credit rating downgrade in April 2011 (Sources: BBC and CNN).

The U.S. Dollar and S&P stock futures both sold off after Moody’s possible U.S. credit downgrade news (Source: Reuters).

Mitch McConnell Makes Bold & Controversial Suggestion
Republican Minority Leader, Mitch McConnell (KY) suggested that in the event of no compromise, the Republicans and Democrats could just effectively give up their power and let the President request how much and when deficits should be raised. This move was supported by Democrat Senate Majority Leader Harry Reid (NV) (Source: Bloomberg). The move by Republican McConnell is shocking.

Why is this shocking? The move would clearly violate the U.S. Constitution which explicitly states:

“The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defense and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States;

To borrow money on the credit of the United States…”

— Article 1 Section 8 of the United States Constitution (Sources: Cornell University Law School, and U.S. Constitution.net)

Notice that nowhere in Article 1 Section 8 of the U.S. Constitution says that Congress can or shall defer legislative power to the President (the Executive Branch); or that the Executive Branch shall have any power to borrow money, or write laws for the Legislative Branch (Congress) to confer with the Executive Branch.

The Three Branches of Government (United States). Image courtesy: socialstudiesgovernment.wikispaces.com

 

Since the U.S. Constitution is being ignored by some at the moment, let’s take a look at a children’s website on how government works.

“A “bill” is introduced when a member of Congress decides to create a new law. Any member of Congress can introduce a bill. Only members of the House may introduce bills that deal with taxes or spending. Before a bill can become a law, both houses of Congress must pass identical versions of the bill.”

— Source: Congress For Kids.net

The biggest mistake Congress could ever do is deferring its legislative power to the Executive Branch. By doing so would effectively create a new legal precedent. The U.S. Supreme Court has a duty under the power of “judicial review” to uphold or rescind any law that violates the U.S. Constitution.

If this were to go unchecked, the Executive Branch could then interpret one motion or action, to be used on future motions or change future laws without Congress’s Constitutional authority. At that point, we no longer have a republic or a democracy, we have but a King. We pretty much found resolution on that issue from England 235 years ago. Let’s not go there again.

UPDATE III: Continues HERE

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Credits:
Political cartoon courtesy of respected author.  ©2011 Newsday

Government branches image courtesy: socialstudiesgovernment.wikispaces.com

Original content copyright © 2011 Net Advisor™

Revised copyright © 2015 NetAdvisor.org® All Rights Reserved.

NetAdvisor.org® is a non-profit organization providing public education and analysis primarily on the U.S. financial markets, personal finance and analysis with a transparent look into U.S. public policy. We also perform and report on financial investigations to help protect the public interest. Read More.
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Categories: Deficit
  1. michael kors
    April 28th, 2013 at 04:42 | #1

    wow, damn good article!

  2. Chelse N.
    April 23rd, 2013 at 13:44 | #2

    amazing report.

  3. nichole O.
    April 23rd, 2013 at 02:26 | #3

    wow, damn good post

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