The true answer in the battle of ideas

The true answer in the battle of ideas is history.

Ten years ago, the state of Michigan was debating whether or not to ease restrictions on concealed carry permits. Previously, you pretty much had to be a judge, police officer, or know someone to get a concealed carry permit in the state. If you were "just a citizen" your chance of getting a CCW permit were nearly non-existent.

The argument for "right to carry" was that you didn't have to worry about the law-abiding citizens who would take a training course, have a background check, fill out the paperwork and legally purchase a gun. They were the law-abiding citizens.

The argument against "right to carry" was that, with the drastic increase in weapons on the street, crime rates would soar and Michigan would return to a state resembling the wild west with a vigilante on every street corner and body counts rivaling a war zone. The average citizen could not be trusted with the responsibility.

After ten years with the less-restrictive law, history has spoken:

http://www.woodtv.com/dpp/news/local/central_mich/10-years-later-gun-opposition-fades

http://www.freep.com/article/20110731/NEWS06/107310482/10-years-after-concealed-weapons-law-unclear-why-many-state-were-gun-shy?odyssey=tab|topnews|text|FRONTPAGE

The fear mongers who wanted to deprive law-abiding citizens of their freedom have been proven wrong.

Data at the time of the original debate showed that other states who had relaxed their CCW requirements experienced no problems.

This should be a lesson to us today. As I write this, we are being blasted from the media about the great horror that will occur if/when we "default" on the debt by not expanding our credit limit. We are also told that failure to increase our credit limit will result in our bond rating downgrade.

Some have recently admitted (and Rush Limbaugh has pointed out for weeks) that the federal government takes in enough revenue to pay the interest on the debt. The chance for a default rests only in the possibility that the President would order the Treasury Secretary to not pay the interest on the debt and instead spend on other programs.

The linkage between raising our credit limit and a bond rating downgrade are specious.

How many of you have gone to a bank to ask for a loan? If you have, you may know that they check your credit rating. That rating is based upon how much money you make, your current debt, and other factors.

Have you ever had to pay a higher interest rate because you had a bad credit rating? Many people starting out (who have not established a credit history) have to pay higher rates, because they have not built a credit history worthy of a higher credit rating. In other words, they are a greater risk, because no one knows if they know how to manage their money and pay back a loan.

Let's take a look at this example:

A couple goes to a bank for a mortgage loan. Everything is good with the collateral and they are approved (barely) for a loan. But, instead of paying 5% interest, they have to pay 6.5%, because they have borrowed a lot of money for things like furniture, clothes and daily expenses. There is some concern that they may not be able to pay off the loan, so they have to pay more interest.

Now, let's say the couple goes out and opens three new credit cards and expands their credit limit.

Why would this make a bank say "this couple is more likely to pay us, now that they have a higher credit limit"?

The short and obvious answer is that they wouldn't. In fact, without a plan for the couple to pay off their existing debt and not borrow as much in the future, a credit limit increase may cause them to pay even more in interest because they become more of a risk.

It is exactly the same with the federal government.

What will assure the ratings agencies is getting a balanced budget in place, cutting long-term spending, and reducing our debt.

Don't just take my word for it, listen to what Moody's (one of the ratings agencies) says:

http://www.zerohedge.com/news/moodys-releases-statement-potential-outomes-us-aaa-review-now-says-virtually-any-deal-would-not

"If the debt limit is not raised before August 2, we believe that the Treasury would give priority to debt service payments and could thus postpone a potential debt default for a number of days. Revenues would be more than adequate for some period of time to meet those payments, although other outlays would be severely reduced as a result.

As to the longer-term outlook on the rating, the limited magnitude of current deficit reduction proposals suggest that even a timely increase in the debt ceiling will lead to the assignment of a negative outlook on the rating. The direction of the US government's debt rating will largely be determined over time by our projections of its deficits and stock of debt, but the focus of our current review for downgrade is the more narrow and more immediate "event risk" associated with a possible debt-ceiling-induced default and the precedent that such a default would carry. We will make an assessment of the government's efforts to stabilize the future path of its debt ratios when the review is concluded."


I am tired of fear mongering in the name of pushing bad ideas. History always shows the results of our ideas.

What will negatively impact our credit rating the most is continuing to spend spend spend without any attempt at balancing our budget.

What will positively impact our credit rating the most is fiscal responsibility.

Raising our credit limit without significant cuts leads us down the path of spend spend spend, which will negatively impact our credit rating.

Enough fear. Let's have a discussion of fact. Once we move into the arena of fact, the choices facing our nation are clear and simple. Cut spending, stop promising things we can't deliver to try to buy votes and start behaving like adults.

Aloha.