Default = depression

There are a few different paths that lead to a depression. Today’s tea party Republicans have found a new one. In the 1920s, three Republican presidents and a solidly Republican Congress rolled back the regulations on big business that characterized the Progressive Era. The result was the stock market crash in 1929 and the Great Depression that followed. Similar Republican policies during the first decade of the 21st century brought us to the recession.

Now add the tea party Republicans to the mix — a loose confederation of right-wing ideologues and libertarians that seems determined to bring down the economy once and for all by sending the country into default. Based on what I see and hear during interviews with some of these representatives, I’m not sure tea party members possess the intellect to appreciate the gravity of the situation or the foolishness of their position. Novices all, their smirks suggest a desire to see what they can break — much like a young vandal approaching a school with a baseball bat.

As we approach the Aug. 2 deadline with no resolution in sight, the stock markets are in the red almost daily. The Dow Jones is close to slipping below 12,000, with “down” the trend for the foreseeable future. Even with a low capital gains tax, this loss of investor income is going to be yet another loss of revenue for the treasury.

I think the very inability for this country to struggle so hard to deal with the debt ceiling is going to be an economic setback for this country. Never mind a return to the recession — a default will almost certainly plunge us into another Great Depression.

Avoid depression — raise debt ceiling

You don’t have to be an investor to worry about a stock market collapse — the Great Depression of the 1930s that followed the crash of 1929 affected everyone. This is why this morning’s Huffington Post headline, “World Markets Tremble As Debt Deadline Looms,” should be a wake-up for House Republicans. They have it in their power to avoid a worldwide depression, and they need to exercise that power. They need to quit posturing and raise the debt ceiling cleanly, and worry about the other stuff later.