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AN AND HE IS NOT OPTIMISTIC.
AND NOVEMBERW
2012, IT IS VIRTUALLY CERTAIN
THEY CANNOT PASS A LARGE,
PERMANENT INCREASE IN THE DEBT
CEILING.
WE WILL HAVE PERIODIC SHORT-TERM
FIXES, ONE MONTH, TWO MONTHS,
THREE MONTHS, THEN THEY WILL BE
BACK TO SQUABBLING IN THIS
ENORMOUS POLITICAL BATTLE WE ARE
HAVING OVER THE MAJOR COMPONENTS
OF THE BUDGET.
REVENUE, SOCIAL SECURITY,
MEDICARE, SO FORTH.
IT WILL BE BACK TO THE SAME
SHOW.
I DON'T HAVE ANY HOPE THAT THEY
WILL COME TO A SUBSTANTIVE
AGREEMENT ON THE BIG THINGS THAT
NEED TO BE DONE BECAUSE BOTH
PARTIES HAVE ROLLED OFF THE
TABLE THE ESSENTIAL THINGS THAT
ARE NECESSARY.
WE HAVE TO RAISE REVENUE.
THERE IS NO DOUBT ABOUT THAT.
WE HAVE TO ALLOW THE BUSH TAX
CUTS TO EXPIRE FOR EVERYBODY.
NOT JUST THE RICH.
WE HAVE TO MAKE HEADWAY
INDENTING THIS MASSIVE $6
MILLION A DAY BORROWING SCREEN
WE ARE ON.
>> $6 BILLION A DAY.
>> $6 BILLION A DAY.
>> LET'S TALK SPECIFICS.
YOU WERE ON WITH TOM KEENE
RECENTLY.
YOU PUT OUT A BUNCH OF THINGS
THAT MADE YOU TALK ABOUT A
VALUE-ADDED TAX.
HOW LIKELY IS ANY OF THIS?
HOW NECESSARY IS IT THAT IT
NEEDS TO HAPPEN IN ORDER FOR US
TO FIX THIS PROBLEM?
>> AT THE MOMENT, IT IS VERY
UNLIKELY.
IT IS A MEASURE OF HOW
UNREALISTIC THE DEBATE IS DOWN
IN WASHINGTON TODAY.
IF THEY WERE REALISTIC, THEY
WILL BE DISCUSSING THE NEW
REVENUE SOURCES THAT WE CAN
POSSIBLY LOOK AT IN ORDER TO
FILL THIS GIGANTIC $1.50
TRILLION HOLE IN THE BUDGET.
WHAT ARE PROS, CONS, THE
TRADE-OFFS.
IT IS PAST THE GRAVE.
THEY SHOULD BE TALKING NEW
SOURCES OF REVENUE AND
INCREASING SOME OF THE EXISTING
TAXES.
>> WHAT GETS US TO THAT POINT?
>> ONLY WHEN WE GET A MAJOR WHAT
I CALL FUNDING CONFLAGRATION INT
HE -- IN THE BOND MARKET.
IN THE LAST 10 YEARS, THE
CONGRESS HAS BEEN LULLED TO
SLEEP BY CENTRAL BANKS TO KEEP
BUYING ALL THE DEBT AND HOLDING
DOWN THE REAL COST OF INTEREST
ON THE MIDDLE AND LONG TERM DEBT
THAT WE ARE ISSUING EVERY DAY.
AND FRANKLY, BOND FUND MANAGERS
THAT SOMEHOW THINK THAT THE
TOOTH FAIRY IS GOING TO ARRIVE
AT FIXED THIS PROBLEM WHEN IT IS
CLEAR.
WE HAVE SOVEREIGN RISK.
WORLD ISLEARLY AS THE
NOW DISCOVERING THEIR SOVEREIGN
RISK IN THE EUROPEAN DEBT
ISSUES.
THE PROBLEM IS NOT THE DEBT
CEILING.
THEY WILL DO IT IN A COUPLE OF
MONTHS AND WE WILL HAVE
BORROWING HAD ROOM.
WE WILL HAVE THE SAME IN PAST
THAT WE ARE AT NOW.
THE DEFACTO POLICY WILL DEFAULT.
WHEN THEY SAY NO TAX INCREASES,
WE WANT THE UNITED STATES
GOVERNMENT TO DEFAULT.
.E CAN SOLVE THE PROBLEM
WHEN THE DEMOCRATS SAY THEY YOU
CAN'T TOUCH SOCIAL SECURITY,