Texas Tea Party Senator Ted Cruz finally ended his 21-hour-19 minute self-promotion at the expense of the US taxpayer and global markets on Wednesday at noon. His nonsensical attempt to establish himself as a Tea Party Presidential candidate most likely eliminated any chance Cruz has for being regarded as a serious candidate in 2016.
Cruz’s stalling tactics on the Senate floor included such lofty pursuits as improving his ability to read Dr. Seuss. American taxpayers and global investors were left shaking their heads at the ludicrousness. Once again the contrarian and obstructionist policies of the radical right wing Tea Party came at the expense of the public good and the GOP brand.
With a possible closure of the government in the balance, Cruz first encouraged House Republicans to pass a bill that would defund Obamacare and later acknowledged that the legislation was doomed from the beginning. In efforts to save face and assert himself as a Tea Party favorite, Cruz launched his 21-hour self-serving initiative.
With many senior Republicans opposed to Cruz’s stall tactics, the Republican party appeared more divided than in the past, suggesting that the only way to get meaningful legislation in Washington was for centrists from both sides of the aisle to bond. Bystanders had to question Cruz’s motives. Many Independents and Democrats believe that what conservatives fear is that Obamacare may in fact trim the cost of healthcare and be a successful program.
What makes Cruz’s childish performance more puzzling is the fact that he represents a state with the highest number of persons without health insurance. It is clear that Cruz’s presidential aspirations surpass his willingness to represent the best interests of his constituents. Instead, Cruz is following the big money that Tea Party supporters pile into American politics.
Global Equities Nervous
The debt ceiling increase has global markets on edge and Cruz’s grandstanding did nothing to calm US or international markets. US equities lost ground for the fourth consecutive day as investors considered the possibility of a government shutdown and default.
Republicans deployed the same strategy in 2011, causing a downgrade of the nation’s credit and billions of dollars in increased borrowing rates. The 2011 debt ceiling strategy unnerved consumers and investors alike.
Treasury Secretary Jack Lew advised Congress that the government would not be able to borrow funds after October 17, when government coiffures would only have about $30 billion. If the debt ceiling is not raised, several important government agencies will not be open for business on October 1.
On Thursday, conversation pointed toward a short-term extension of the ceiling while the House and Senate try to hammer out a longer term deal. It is expected that the Senate will strip the defunding of Obamacare provision and send the debt ceiling increase back to the House on Saturday, giving House Majority leader the opportunity to put the stripped down version to a vote.
However, Boehner may or may not bring the Senate’s bill to the floor. House Republicans are meeting Thursday to strategize. Weakened by Cruz’s performance, most analysts expect the House to pass a temporary quickly but American taxpayers have learned that their government is paralyzed by the most dysfunctional Congress in the history of the nation.
According to a New York Time poll, 80 percent of Americans say it is unacceptable for Congress or the president to threaten shutdowns during fiscal negotiations.
Investors and Taxpayers Uncomfortable
Secretary Lew emphasized that if the government becomes unable to pay its bills, the consequences would be catastrophic. Historically, debt ceiling negotiations have a negative effect on equity markets.
On Thursday, the FTSE 100, Germany’s DAX and France’s CAC 40 all opened lower. Equities in Shanghai and Singapore also opened lower.
On Wednesday, the DOW was off 0.4 percent, the fourth consecutive down day. The S&P 500 lost 0.267 percent, its fifth straight losing day.
The dollar posted modest gains against the yen (98.92), euro ($1.352) and British Sterling ($1.6027). Yields on the 10-year Treasury hovered around 2.64 percent.
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