The Nation's Chris Hayes filling in for Lawrence O'Donnell on MSNBC's The Last Word talked to the Center on Budget and Policy Priorities Jared Bernstein and the Movement Vision Lab's Sally Kohn about where things are headed on these debt ceiling negotiations.
July 1, 2011

The Nation's Chris Hayes filling in for Lawrence O'Donnell on MSNBC's The Last Word talked to the Center on Budget and Policy Priorities Jared Bernstein and the Movement Vision Lab's Sally Kohn about where things are headed on these debt ceiling negotiations.

As Bernstein pointed out, even stalling around with this game of chicken as Republicans are doing can start to have real costs and consequences for our fragile economy with the possibility of interest rates going up if the markets start to get spooked that nothing is going to be done as the deadline moves closer.

Sally Kohn I believe, really made some of the best points during the discussion where she noted that the majority of the public does want to see tax increases on the rich and asked why the Democrats are not fighting harder on those issues and what lines in the sand the Democrats should be drawing during these negotiations when the Republicans are acting like "ideological terrorists" who are willing to blow up the economy if they don't get their way on everything.

As Fran and Driftglass pointed out in their podcast this week, Kohn, who regularly appears on Fox but who isn't what you would consider one of your typical "Fox Democrats" actually wrote a very good article this week which appeared in of all places, Fox's opinion page on their web site, which you can read here -- We Don't Need to Cut Corporate Taxes, We Need to Raise Them.

Both of them agreed that the Democrats need to be calling out the Republicans for their stance on refusing to include additional revenue as part of the agreement and Bernstein explained why that is absolutely necessary as well.

BERNSTEIN: Well, the path forward is an ugly one, because the path forward has to be calling, it's not a bluff, it has to be calling their position. There cannot be a deal without revenue in the deal. If you try to squeeze out a path to budget sustainability or anything like that without revenue, you will have to cut government to the point where it would be unrecognizable.

And I'm talking about military, Social Security, you know, health security, retirement security, education, infrastructure, protection for low income people. The reason why revenues have to be part of the deal is not be want things to be balanced or things should be even and we want this and they want that. It's because without revenue, the pressure on spending is so deep that you will cut the floor out from under this economy. And that is economically suicidal.

And sadly, I think that's exactly what the Republicans want. Hayes asked Kohn what she thought of calling their bluff and expressed his concerns with doing it because as he noted, in times of economic crisis, "working people get screwed." Kohn suggested we need a campaign where every American is asked to donate some spinal fluid to the Democrats and not "stick a knife in the backs of the middle class." When asked what calling their bluff meant specifically, Kohn responded.

KOHN: Well unfortunately, they're backing the president into a difficult situation, but I think frankly, the Republicans here, and not all the Republicans, but the extreme right of the Republican Party, are acting like ideological terrorists. They're literally willing to blow up our economy and the future of our nation to score a few political points. And I think this is the point where the president has to say, look, we don't negotiate with the ideological terrorists. We're going to stake a claim here. We're going to stand for working people and trust that if he does the principled and economically sound thing, the public will be with him, and then know where the real blame lies.

I couldn't agree more but wonder if they've already managed to negotiate away with these "ideological terrorists" any chance of that happening with the massive cuts they've already agreed to so far. Bernstein followed up by asking where the pressure is from business groups on Republicans to finally get something done and quit playing games.

I don't know how this plays itself out in the end, but watching this kabuki theater as they threaten to destroy what's left of our economy either with not raising the debt ceiling and these cuts being demanded to do it is wearing really thin right now and that's about the nicest thing I can say about it, so I'll leave it at that.

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