In a brazen attempt to raise the already exploding US public debt, U.S. Treasury Secretary Jack Lew warned Congress on Wednesday that the government will spend all its borrowed cash by October 17th, and demanded trillions in new money to keep financing Washington DC's insatiable appetite for debt.
"The debt limit impasse that took place in 2011 caused significant harm to the economy...If Congress were to repeat that brinkmanship in 2013, it would inflict even greater harm on the economy. And if the government should ultimately become unable to pay all of its bills, the results could be catastrophic," threatened Lew, in a letter addressed to Speaker of the House, John Boehner.
Boehner quickly signaled complete capitulation and surrender by assuring Lew that the debt limit in fact will be raised. "...we need to
surrender work together soon on a bill that raises the debt limit and deals with causes of the debt by cutting Washington spending and increasing economic growth," said Boehner's spokesman, Michael Steel.
Jack Lew has been notorious in his total disregard for the American people and has been criticized for deception and evasiveness by both Democrats and Republicans in the past. Here is Senator Jeff Sessions (R-Alabama) questioning Lew, the then White House Budget Director, during the February 2011 budget hearings.
After Lew's anointment as Treasury Secretary he squared off with Senator Elizabeth Warren (D-Massachusetts) on the systemic nature of US financial crisis in May this year:
Democrats and Republicans have repeatedly quarreled over raising of the debt ceiling, with each side blaming the other for the catastrophe that would unleash if the deadline passes without satisfying Washington DC's demands.
While the conservative wing of the Republican Party has made some faint noises of rebellion in opposition to raising the limit, every time the deadline approaches, the far-left GOP House leadership led by John Boehner, Eric Cantor and former Vice-Presidential nominee Paul Ryan, invariably yields without a fight over spending cuts.
The latest debt limit bill could be introduced as early as Friday in the House, where GOP holds the majority, but there are indications that enough Republicans will join the overwhelming majority of Democrats to offer trillions in new money to finance Federal government's programs.
A few Republicans including Senator Ted Cruz (R-Texas) have waged a quixotic crusade to use debt ceiling as a leverage to delay the implementation of Obamacare, but with scant support from within their own party, all their efforts have been null and void from the start.
At the same time President Barack Obama has made it clear that he will not bargain with GOP on tearing an even bigger hole in America's finances, and Democratic leadership led by Nancy Pelosi and Harry Reid are clamoring for a debt limit increase without any stipulations or spending cuts.
From 1995 to 2011, the debt ceiling was raised 12 times to finance the enormous growth in US government spending.
During this period, Federal Reserve, which has an unlimited capacity to create "money", pumped trillions of Dollars in the financial sector leading to massive real-estate and bond bubbles coupled with runaway inflation in medical-care, education and housing.
In order to placate the gullible GOP electorate, the Republican led House has already passed a stop-gap spending bill that prioritizes payments to bondholders, Social Security retirement checks and provisions for nation-building abroad.