No Dealing On The Debt Ceiling, Part 31

Ahh, the Debt Ceiling battle.  You know something's up when Orange Julius has gone right back to his position from early this year, which is "If we don't raise the debt ceiling and America defaults, it'll be catastrophic for the economy."

In a political role reversal Friday, House Speaker John Boehner (R-OH) warned that Congress risks severely harming the economy and exacerbating the unemployment crisis if it fails to raise the national debt ceiling in the next four weeks.
"While some think we can go past August 2nd, I frankly think it puts us in an awful lot of jeopardy, and puts our economy in jeopardy, risking even more jobs," Boehner told reporters at his weekly Capitol briefing.

So what's his game?  Why the reversal?  Republicans have not only spent months trying to convince Americans of the fallacy that federal government spending should operate exactly like an American family's finances ("macroeconomics at the highest level should work exactly like microeconomics at the smallest" which is patently ridiculous) but they've been adding that the country can default on its debt and miss a payment without any real world consequences, either.

I've said for months now that the consequences of a default would be to cause interest rates to double or triple from their current position.  The cost of borrowing gobs of money would skyrocket, and Wall Street has been happily borrowing gobs of money at ridiculously low interest rates for a couple of years now.  They're having a great time doing it, too.  Corporate profits are up sharply.  Stockholders are generally happy.  CEOs are raking in the cash.  For Wall Street especially, they've got all kinds of cash to play Big Casino games with the economy just like they were during all of the last decade.  A default would mean the end of the gravy train.

The Crazy Tea Party wing and the Greedy Evil Corporate wing of the GOP are now in open conflict.  Eric Cantor, Michele Bachmann, Jim DeMint, Rick Santorum and the rest may be taking orders from the former, but Orange Julius is taking his orders from the latter, and they want this debt ceiling default nonsense gone.  Yes, the Tea Party types have been shrieking that raising the debt ceiling will be done over their politically dead bodies, but the guys with the gold-plated toilets and the billion-dollar hedge fund manager incomes figure they're in charge of the Republicans, and Orange Julius here proves it.

Oh yes, the Tea Party will threaten to remove Boehner from power, just like they did in December when President Obama pulled a fast one over on them.  He's not going anywhere.  Not unless the voters across the river from me in the tony Cincy suburbs north of the 275 loop suddenly develop souls.  I said long ago that the GOP would never be allowed to blow up the bond markets.  This complete reversal proves the moneyed interests are now playing hardball and want a deal ironed out now.  Orange Julius has been given his marching orders.

The only question at this point is what the details of the deal are.  But it's happening and soon.

[UPDATE] And the reason I said there would be a deal soon was that otherwise, Orange Julius's career was over.  But looks like he just blew it big time. Looks like Orange Julius is pulling out of the talks, which means he doesn't have the votes, which means that while Wall Street is certainly leading him around by the nose, the Tea Party crazies have just sabotaged the whole thing and have decided there will never be a deal.Orange Julius just lost control of the asylum.  By comparison, President Obama looks like the adult in the room.  It's almost like President Obama knows what he's doing in these negotiations, and he's just put Boehner in an untenable position.  Things will fall apart quickly now for the GOP.