Kerry chastises GOP over deficit crisis

July 16, 2011|By Michael Levenson and Theo Emery, Globe Staff

Republicans are holding the nation hostage by using the vote to raise the debt limit as a way to advance their ideological agenda, Senator John F. Kerry charged yesterday, adding that tax increases had to be part of any long-term solution to the deficit crisis.

Addressing reporters outside his Boston office, Kerry said that if the US defaults on its loans, the consequences for the state, national, and global economies would be “absolutely devastating.’’

Hundreds of thousands of veterans and Social Security recipients would see benefits delayed, he said. If the nation’s debt rating is downgraded, he said, 600,000 Americans could lose their jobs, and the stock market could plunge, jeopardizing retirement savings.

“This default has to be avoided at all costs,’’ Kerry said, and “you have to have revenue be part of the mix.’’

Democrats, he said, are proposing a tax increase on Americans who earn more than $250,000 a year, along with major spending cuts that Republicans are seeking. Kerry, a multimillionaire, said wealthy Americans can afford to pay more in taxes.

But Republicans have rejected any increase in taxes, warning it could hurt the economy.

“We need to stop the phony debate,’’ Kerry said. “It’s time to stop taking America hostage for small ideology. It’s time to get the job done.’’

Governor Deval Patrick also warned of the potential calamity a government default would create, telling congressional leaders in a letter that states can “ill afford to bear the brunt of such a preventable crisis.’’

Patrick said that a default would interrupt more than $200 million in weekly reimbursements that Massachusetts draws from the federal government, from Medicaid to food aid.

“Failure by the US government to meet its obligations to the commonwealth for even a short period of time could create a serious state cash flow issue,’’ he wrote.

READER COMMENTS »

View reader comments » Comment on this story »