Fear not Oct. 17
Stuart Varney is a Fox Business Network anchor and host of “Varney & Co.,” which airs weekdays from 9:20 a.m.-11 a.m. Varney spoke to the Trib about the approaching deadline to raise the nation's debt ceiling.
Q: In your opinion, is the debt ceiling crisis really as potentially catastrophic as it's been made out to be?
A: Potentially yes, but that's way down the road.
If we go past the (Oct. 17) debt ceiling deadline and there is no deal, then we are starting into some very serious territory because at some point we do default on our debt, we don't pay back our principal and interest.
But frankly it's inconceivable that we would go that far. But we will have serious upset in the markets before then if we don't get a deal.
Q: Could you explain why there's no immediate danger of default if we go past the deadline?
A: Yes. If we go past the deadline, we lose the authority to borrow any more money. However, we have a ton of money coming into the Treasury from tax receipts.
It's estimated that in October alone, tax receipts will come in at about $220 billion. Now, you can use that incoming money to pay interest on the debt, to pay Social Security checks, military pay, Medicare bills.
You can do all of that and you don't actually come to the default point for a long time — well into November. That's why I say there is absolutely no threat of default at midnight in Oct. 17, as some in our leadership have implied.
Q: So you believe the deadline is being overhyped?
A: Yes. In my opinion, the president and Sen. (Harry) Reid are using this deadline to inspire some fear in the marketplace and to put pressure, political pressure, on their opponents.
If you say this is a catastrophe in the making and it's your fault, you are putting pressure on your political opponents. And I think that is what is going on now in America.
I don't approve of that, because the president is the chief executive officer of the United States of America. It is his job to organize government, to organize government's response to financial crises. To say “I will not negotiate” — I think that's just not doing your job.
Q: Do you think the president and Sen. Reid are deliberately attempting to incite volatility in the marketplace by claiming the effects will be catastrophic if the deadline passes?
A: That would be my position. It's not a game that we should be playing and I think everyone understands that.
But it's a game we are playing right now and I don't think we look terribly good in the eyes of the world.
Q: Do you mean not looking good in terms of the government constantly playing this game of chicken?
A: I mean this constant running up to deadlines, haggling publicly, taking diametrically opposing sides, no negotiations, one crisis after another where we seem to be totally disorganized and dysfunctional — that makes us look bad.
Q: Is there any silver lining in this situation?
A: The key issues are being discussed. OK, we don't have a solution, but we are discussing the issues.
And I think America (eventually) will emerge with solutions to the problems of debt, taxation and spending.
Q: When do you think that might occur?
A: It's a long way off, a long way off.
Eric Heyl is a staff writer for Trib Total Media (412-320-7857 or email@example.com).