The House Democratic Caucus found this audio from Pres. Ronald Reagan in 1987:
REAGAN: Congress consistently brings the Government to the edge of default before facing its responsibility. This brinkmanship threatens the holders of government bonds and those who rely on Social Security and veterans benefits. Interest rates would skyrocket, instability would occur in financial markets, and the Federal deficit would soar. The United States has a special responsibility to itself and the world to meet its obligations. It means we have a well-earned reputation for reliability and credibility – two things that set us apart from much of the world.
Reagan’s claim that defaulting on the debt ceiling “threatens the holders of government bonds and those who rely on Social Security and veterans benefits” is noteworthy because after Pres. Obama made a similar assertion, tea party Republicans in Congress accused him of lying.
Rep. Joe Walsh, a hyped-up freshman tea bagger from Illinois, rushed out a amateurishly produced video in which he said, “Pres. Obama, quit lying. You know darn well that if Aug. 2 comes and goes, there is plenty of money to pay off our debt and cover all of our Social Security obligations.”
So, just to connect the dots, Rep. Joe Walsh, R-Ill., has inadvertently also accused Reagan, the patron saint of tea baggery, of lying, too.
Last week, three other prominent House tea baggers — anti-gay presidential candidate Michele Bachmann of Minnesota, Louie Gohmert of Texas and Steve King — held a news conference in Washington in which they also accused the president and his advisers of misleading the public about the consequences of default for Social Security recipients and others:
“[House Speaker John Boehner] is getting bad advice,” Gohmert said at a press conference. “I guess the problem with the speaker and him saying that [the debt limit needs to be raised by Aug. 2] is that he listened to the president. I’ll urge the speaker not to believe the president anymore.”
Gohmert, along with [Bachmann and King], introduced a bill on Wednesday that would require the president to pay off interest on the nation’s debt first, if the debt limit is not increased by Aug. 2. “It’s a misnomer that the president has been trying to pass off on the American people,” Bachmann said at a press conference for the bill.
Credit ratings agencies have warned they will downgrade the government’s credit rating if it begins the process of defaulting on its loans.
But King, calling the president’s statements on the debt ceiling “veiled threats, if not an ultimatum,” said the nation’s credit rating could remain intact even if the debt limit is not increased by Aug. 2, so long as their bill to pay interest on the debt was passed.
“Our credit rating, we’re trying to preserve it with this bill,” King said. “We want to guarantee our credit rating stays.”
It is unclear whether Bachmann’s bill requiring the government to pay the interest on its debt before any of its other obligations would, in fact, make it more likely that payments to recipients of Social Security, veterans and others would not be made.
Reagan also warned about the consequences of defaulting on the debt ceiling in 1983. In a letter to the Senate majority leader, Reagan said, The risks, the costs, the disruptions and the incalculable damage lead me to but one conclusion: the Senate must pass this legislation before the Congress adjourns.”
As president, Reagan also raised taxes at least seven times, including the largest corporate tax hike in history. As governor of California, one of his first acts was to raise taxes and spending in the state. He raised taxes by $1 billion, which in today’s dollars is the equivalent of $6.5 billion.