What the Tea Party did was high light how hard it will be to cut spending.
It is very clear that the earliest any meaningful proactive cuts can occur is after the 2012 election. Depending on the results, maybe not until after the the 2016 elections.
Between then and now, we can expect to add another 3 to 9 trillion to the outstanding debt. It isn’t clear we can find willing lenders to finance that debt. Clearly there are plenty today but assuming there will always be plenty is risky.
The Tea Party did not threaten to default. Obama did. The Tea Party did threaten to shut down 40% of the government. The choice to prioritize other spending ahead of the debt repayment would have been made by the executive branch.
Our good credit rating isn’t based on our willingness to “borrow what ever it takes” to pay back our loans. It is based on our willingness to “do whatever it takes” to pay back our loans. As a group, we don’t seem all that willing to do anything.
I don’t see any likely hood that we will make any significant spending cuts absent a real borrowing crisis such as Greece, Spain, and Italy are experiencing. This could occur tomorrow or years from now. If we continue to run up a debt we have no hope of repaying, it will happen.
A small increase in tax rates won’t make a dent in the problem. Something like doubling all the tax rates for everyone (not just the rich) would be required but that would radically change taxpayer behavior. I personally wouldn’t see much point to working if that occurred.
