July 30, 2011

Manchin Trying to Hold Out For a Long-term Debt Fix | The Beckley Register-Herald

America isn’t necessarily headed into the toilet if the debt ceiling “debacle” isn’t resolved by Tuesday’s deadline, but Sen. Joe Manchin is worried that the nation’s credit rating could be in for a severe beating that could take a long time to repair.

Manchin made those points clear Friday in a telephone conference call with West Virginia reporters, as Congress sought to escape gridlock and the nation’s nerves grew more frayed.

Hours before he fielded questions, Manchin rose on the Senate floor to apologize to the nation for the stall, or “debacle” as he termed it, and told reporters the only truly bipartisan approach he has seen to the morass of debt has been the Bowles-Simpson Commission.

Grim warnings have escalated this week about the failure to raise the debt ceiling, some even predicting the fall of the republic itself under the weight of unpaid bills, but Manchin disagreed, saying, “I don’t think that can happen. It won’t happen.”

The freshman senator and former West Virginia governor likened default to a family with $5,000 in bills one month and a mere $3,500 to cover them.

“You’re going to make some decisions about what you’re going to pay and what you’re not going to pay in those bills,” he said.

“They’re scaring the Social Security and Medicare, which is ridiculous. That’s not going to happen. I believe we’re going to be able to work ourselves through this. But I do worry about the credit rating now. If we lose the confidence of the credit rating and financial institutions and worldwide markets, then you’ve really got a problem. You don’t call that back overnight.

“We can come up and move money around and pay bills. That’s a little bit more fluid. When you lose confidence, that takes a while to rebuild.”

Citing financial experts, Manchin said credit rating agencies will downgrade the nation’s scorecard unless there are at least $4 trillion in cuts over a decade.

If the credit rating takes a nosedive, Manchin said the impact would be far-reaching — a sell-off of stocks, U.S. Treasury securities and American dollars, higher gold prices and soaring interest rates across the board. All that combined would be devastating to small businesses and local governments, he warned.

Manchin agreed that the average American should be outraged over the standstill and inability of Congress and the Obama administration to put the debt ceiling issue behind them.

“They should be mad,” the senator said.

“You should be looking and questioning every person that asks for your vote. Does that person seem rational? Is that a person you can reason with?”

Manchin called House Majority Leader John Boehner, R-Ohio, and Senate Majority Leader Harry Reid, D-Nev., “two great people,” but faulted each one’s proposal.

Boehner’s plan is a $900 billion one that eases troubles for six months, letting them resurface in an election year, while Reed has a $2 trillion proposal that gets America past 2012, but neither is fair, Manchin said. Boehner revised his plan to require a constitutional amendment to balance the budget.

Manchin has no qualms with a mandatory balanced budget but said he doesn’t want it as a condition of resolving the debt ceiling standoff.

“I don’t think we should be voting again anytime soon as far as fighting on the same turf,” he told reporters.

“I want a guaranteed vote before the end of the year that we’re going to fix our long-term problem, and the trigger would be this commission has to report back before the end of the year.”

Manchin decried the “political posturing” that has eclipsed the Capitol Hill debate and said it has had a negative impact on the debt issue.

“People are sick and tired of political posturing that gets nothing accomplished,” he told reporters.

“I’m sick and tired of it. I came here to fix things. I didn’t come here to kick the can down the road. I didn’t come here to vote on something that gets me taken care of past the 2012 election but left you on your own.”

By:  Mannix Porterfield