All In   |  May 10, 2013

GOP: Pay bondholders, not Medicare recipients, if US nears default

Chris Hayes describes what the recently House-passed "Full Faith and Credit Act" would do, and it looks like political suicide for Republicans.

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This content comes from Closed Captioning that was broadcast along with this program.

>>> yesterday the republicans with very little fanfare took a vote that strikes me as complete and total political suicide. the vote was on the full faith and credit act, which is a republican attempt to essentially strengthen their bl bluffing position in their latest effort to blow up the economy with the effort of slamming the debt ceiling. in order to take off the edge they will bring with the apocalypse, republicans are saying, no, no, no, not financial apocalypse.

>> there is one thing that could do even more damage than delaying payments on our other bills, and that is the threat of a default on our sovereign debt . this measure takes that threat off the table.

>> oh, but not true. even if this bankruptcy-like payment scheme worked as republicans claim, the country would still go into default which is why economists have called possible efforts of paying some creditors over others the financial equivalent of that bosch painting of hell and while chris holland called the creditor act a hare-brained idea. here's how the republicans want to decide who gets paid. social security recipients and bond holders. and if there's any money left, that could go to everyone else, that being active service duty members, city health inspectors, nothing important, mind you. but house speaker john boehner is not concerned about that.

>> you're basically saying you'll pay china before you pay u.s. troops ?

>> those who loaned us money , like in any other proceeding, if you will, court proceeding , the bond holders usually get paid first. same thing here.

>> and you're not worried about the politics of this.

>> not at all.

>> the bond holders get paid first, to which stenny hoyer said just yesterday speaker boehner admitted this bill means the united states will voluntarily act like a bankrupt corporation and pay china before we pay our troops. not only misleading, it's not just chit knees who own american bonds, most debt is held by ourselves, including state and local governments. nearly 60% of debt is held by external debt , china being the biggest holder. there are also oil exporters , caribbean bankers and oil. john boehner says he cares about seniors. then why did he vote to send checks to saudi princes instead of medicare recipients? or -- eric canter voted to pay china before our own troops. whose side is on he, anyway? or paul ryan . he wants to send barrels of cash to russian fat cats while you eat tainted mad cow beefburgers. tell paul ryan those aren't our values. my favorite thing about this bill is this. i have never seen a purer distill lags of the republican party than this bill. just like any bankruptcy proceeding , the bond holders get paid first. that should be the motto for the republicans in the midterm elections. bond holders get paid first. who is the republican base? it's old folks on social security and bond holders. if you want to talk about what is the moderate republican party, it is a creature based on social security and a financial base of bond holders. that is the party we're talking about. and they just went to the floor of the house of representatives and said, you know what? when the bleep hits the fan, our people get taken care of, so screw the rest of you. we'll be right back with click 3. are you still