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Shutdown: ObamaCare (No) and the Federal Government (No)

Written by Gary North on September 24, 2013

The House of Representatives is making a symbolic attempt to shut down ObamaCare. The members know that they cannot get this through the Senate. Obama would veto it even if they could.

Why are they doing this? Because they can. They can let the voters back home know that they are taking a stand. They identify themselves as anti-ObamaCare. They can run on this platform in November of 2014.

Once the bill is rejected, they will have to calculate how long they can continue to refuse to vote for the debt ceiling. Will they last beyond the time when the Treasury Department can no longer cook the books by playing games with federal retirement funds?

Will they eventually capitulate? Yes. Again, they are making a symbolic gesture: “We don’t like the deficit.” Do they hate it so much that they are willing to shut down or make $700+ billion a year in spending cuts? No. They will catch too much opposition from voters who are on the dole.

The public does not care about the deficit. They care about free goodies, and they care about taxes. They have not allowed the federal government to collect as much as 21% of GDP — not even in 1944, during World War II.

The deficit is perceived as make-believe: free money. The voters have shown that they do not care. But they want their free goodies, and they will not tolerate federal taxes.

The House Republicans are taking a stand where voters are unwilling to let them take a stand at voters’ expense. “We want goodies! We want goodies!” If the Federal Reserve has to create money to buy over half the deficit, who cares? Not voters, who have never heard of the Federal Reserve. Not academic economists, who are employed by it or hope to be. The FED employs 20,000 people, using free money to pay them.

So, how long will House Republicans continue to take a stand? Until the polls indicate that they will lose in November 2014.

On October 1, enrollment in the exchanges is to begin. But hardly anyone knows how to enroll yet. The computer programs are not ready. The confusion has not yet hit. The sense of betrayal has not yet hit Obama’s poll numbers.

If Republicans can hold out long enough for resentment against the program to spread, they win politically. They can hold out longer. But at some point, they will capitulate. That’s what the uncertainty is all about. It’s about the timing of their capitulation. If they wait too long, we could get a Democrat-controlled House in 2015. Pelosi would be back in power. The Pelosi-Reid-Obama team would run the country for two years. What might come out of that?

In November, both parties want to run on this slogan: “We told you so.” The Democrats want to run on “We told you so about Republicans’ hostility to the middle class.” Republicans want to run on “We told you so about how bad ObamaCare is.”

That’s what the House’s fight is really all about. They can make their point before the government really does start cutting spending enough to create backlash in November. Then they will decide that enough is enough. They will vote for another continuing resolution.

The fight will be over how long the continuing resolution is for. From the Republicans’ viewpoint, the shorter, the better. They will then get to complain about ObamaCare every few months. The Democrats want a long extension. That will be what the fight will boil down to. But the House Republicans will capitulate.

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8 thoughts on “Shutdown: ObamaCare (No) and the Federal Government (No)

  1. In Zimbabwe they have paper money printed in $10 trillion (USD) denominations. So did Germany during the Weimar Republic days. So will America in the not-too-distant future, thanks to private central banking.

  2. old_salty_dawg says:

    I say not only defund Obammycare but outright KILL IT. Shut down Obama and the Senate which will save far more than the 700 billion in cuts needed to help America. We could get nearly as much as what is needed by shutting down just two of Obama's vacations. America would be best served if they did shut down the Government since it is that body that is wasting OUR tax dollars in some of the MOST IGNORANT OF WAYS. Obammycare is just one of those IGNORANCE LADEN ways.

  3. Sorry, but Zimbabwe does not print anything in USD. They may have "dollars", but they are Zimbabwe dollars, not US dollars (USD).

  4. If the Republican party ever wants to come back, they must make a stand someplace. Until they prove that they have a spine they will not succeed. They may lose on an issue but that is OK if they come across as principled. As far as the Fed's funny money, the first place those folks that don't understand the Fed will get hit is the supermarket. So much of our produce is imported these days (that's how we get fresh fruit in January) prices go up when the dollar goes down. See my blog at http://cranky-conservative.blogspot.com

  5. The GOP will have to capitulate. They have no choice for the reasons listed in the article. The reality is that a large percentage of the "masses" do not understand economics or inflation or the FED or sequester, or anything else other than freebies. That is the reality.

  6. The US economy is destined to fail on the back of government spending and the Fed's policy. Don't prolong the misery. Let it fail now, so the rebuilding can begin. Remember freedom? I don't but I've heard stories about it.

  7. If we fall now, we will never recover. We must correct the Liberal spending sprees & get out of debt now.
    Obamacare is a nightmare and must be stopped!!!

  8. Kathy Sudduth says:

    I agree totally!