In a recent interview with the Washington Post, freshman Representative Ted Yoho, a Tea Party-backed Republican from Florida’s 3rd District, said the following about the possibility of the U.S. defaulting on its debt:
“I think, personally, it would bring stability to the world markets.”
If by “stability” he means an unholy amount of fear and chaos rippling through the world’s financial markets, where basically all lending freezes up and the world’s safest, most liquid asset (U.S. debt) loses all its credibility, then yes, he’s right. A default would bring about all those things.
While the highlight of the piece is clearly that quote, it’s worth reading the entire story. The writer, David Fahrenthold, paints a vivid picture of Yoho, a 58-year-old trained veterinarian, as a lawmaker who sees himself as a guardian against expanding government and whose constituents, he believes, have sent him to Washington to stop the government from “running 100 miles an hour toward socialism.”
Through most of the debt-ceiling debates, both this year and in 2011, I’ve tried to give the benefit of the doubt to House Republicans who seem willing to allow the U.S. to default on its debt. They don’t actually want to trigger a default, but they are desperate—and, perhaps, nihilistic—enough to use it as a bargaining chip with a president they have so far been able to outmaneuver in negotiations. They understand what would happen, right?
Now, I’m not so sure.