EXCLUSIVE: Cavuto Previews Saturday's LIVE Cost of Freedom, 'Shut Down, What's Up?'
We’re working this weekend, let’s hope they are.
Because as this shutdown drags on, we are wondering what’s up?
What’s up with a president who has repeatedly adjusted and delayed key elements of his healthcare law but suddenly now won’t entertain anyone else doing the same?
And what’s up with Republicans who knew they were facing an impossible task in trying to defund that law outright and tempt a government shutdown that fairly or not made them look insane?
Appearances are everything in Washington, and right now neither side is looking good.
But this weekend, we’re going to turn the conventional views you’re getting on all this upside down. The mainstream media is quick to say Republicans look stubborn for wanting to control runaway spending, but amazingly never say the same about Democrats, who seem just as adamant about continuing such spending.
But never mind that obvious double standard, we’re going to explore a more revealing historical one. Because a closer look at history suggests that in the end, it’s not the shutdown that defines each party, but what happens after the shutdown.
The last time Washington turned out the lights 17 years ago, Republicans quickly got blamed for being heartless, clueless, and in the end, feckless. Talk was they’d never recover and their obstinate behavior would weigh on them for years to come. In retrospect, while they did end up losing nine House seats in 1996, people forget Republicans also picked up two seats in the Senate, and strengthened their grip on statehouses across the country.
But far more intriguing, and lasting, is what that rambunctious Congress got a then free-spending President Bill Clinton to do – stop spending so freely.
Remember what happened after everyone got back to business? Whole agency budgets were cut, and federal spending as a percent of the GDP, slowed to a crawl. Unprecedented then. Unprecedented since. Then came revolutionary changes in entitlements, including welfare-to-work, and means-testing at least a half-dozen federal benefits programs.
To Bill Clinton’s credit, he didn’t fight this wave. He ultimately decided to see the parade for what it was, and get in front of it. Good for him, yes, but good for taxpayers in general.
Remember, that is when the economy started to boom, triggering huge revenues for the government and huge advances for the stock market. Suddenly deficits became surpluses, and an internet boom became a bonanza. There were risks to come, but at the time, rewards for many. It was unprecedented, and both parties had a hand in it.
The mainstream media doesn’t recall that particular fallout from the last shutdown, but it’s important American taxpayers do, because the arguments are remarkably similar today. This latest Washington saga is about spending, pure and simple.
The healthcare law is a big part, but I stress it is not the only part. So Republicans don’t lose if they can’t defund it. What Texas senator Ted Cruz and others prove is that by reminding Americans of the law’s excesses and costs, Americans of all stripes become increasingly anxious about those excesses and costs. They’re looking at big government, and the costs of big government.
That’s not a bad thing. And the two sides reconciling their fundamental spending differences and at the very least, controlling the growth of that spending, aren’t bad things either.
That’s why we’re stepping back this weekend: we’re not just looking past a shutdown. We’re shutting out all the noise around that shutdown. If you’re expecting business-as-usual, “terror is on the way” coverage of this soap opera, then I’m telling you now – change the channel. We’re not even hinting of it.
We’re stepping back - way back - to what happens when government slows down, and more importantly, what does not happen. Then we'll start asking questions that others might miss. Not just about why 800,000 federal workers are not on the job, but how it is that many are considered non-essential and don't have to show up.
We'll start breaking down how whole government agencies can continue operating on skeletal staffs, and some with barely any staffs at all. Maybe that’s why some Democrats fear this shutdown dragging out as much as Republicans. They know that the more time goes on and life just goes on, the more folks at home start asking … what’s the big deal? And what were all those federal workers doing?
And we’re not only focusing on a shutdown that continues to make news, but an even bigger spectacle that could create panic: the impending debt ceiling that we all start bumping up against in mid-October. Treasury Secretary Jack Lew says around October 17, we’re out of dough, down to our last $30 billion. But does that mean that if we drag past that deadline, we go into default?
The president and leading Democrats pretty much say that’s the case, but we disagree. The government will be up against the wall, but that doesn’t mean the U.S. government goes in the tank. It’s very much like an average family, similarly pressed, juggling and prioritizing what bills to pay.
And just as that family would put the mortgage or rent payment first and let the Visa or MasterCard bill slide, the government isn’t much different. Its highest priority during such a crisis would be making sure it avoids default, by paying bondholders. Those investors buy U.S. debt – treasury securities and the like – precisely because of the safety and guarantees the U.S. government provides.
No one, neither Republicans nor Democrats, wants to mess that up, so expect the government to keep paying up, and maybe letting other bills slide.
So, allow me to burst that default bubble now. It ain’t happening. But that doesn’t mean a downgrade of this country’s credit rating still can’t. It can, and if this drags on very long, it likely will.
Remember, a couple of years ago, the ratings agency Standard & Poor’s called this fiscal circus for what it was and wacked our pristine triple-A rating down a notch. Other agencies didn’t follow, but that doesn’t mean they still won’t, or can’t.
That’s when this stuff will hit home, and start likely costing you – resulting in higher interest rates, and decidedly dicier markets. Still, there is a pathway out, if both parties double down and get serious. If they show they can get a handle on long-term spending and entitlements, and indicate at least a willingness to show the time for games and brinkmanship is over, maybe we’ll just be getting started.
Hope springs eternal, of course. But call me a naïve optimist, because I’m optimistic cooler heads will prevail and better days will come. Our history as a country proves it. Look at any chart of the Dow, dating back to the beginning of the last century. You name it, we’ve faced it, and triumphed through it.
Two world wars, a depression, multiple energy crises, a presidential assassination, a presidential resignation. Internet stocks bubbling up, whole markets melting down. Terrorist attacks and privacy attacks. We in this country keep fighting back.
That’s what I’m big on reminding folks each show and every show. That this country always puts on a heck of a show but always in the end shows remarkable resolve and resilience. I suspect we’ll do the same.
And this weekend, I’ll provide you with the guests and stories and historical perspective. We’re more than ready to deal with these latest challenges again – maybe clumsily, maybe awkwardly, maybe even comically. But we will. Because we’re Americans and that's what we do. And come this weekend, I’ll make this bold prediction and lay out all our options when I once again say … we will.
Tune in. And remember: just because our government’s shut down, America is never shut out. So let the mainstream media say we’re going to hell. Let me remind you we’ve been through far more hellish things. See you Saturday. Prosper … all days.
Join Neil at 10a ET Saturday for a two-hour LIVE Cost of Freedom: Shut Down, What's Up?