The intransigence of Republican Party, especially their Tea Party component to raise debt ceiling is sending Canadian Dollar, Gold and Swiss Franc soaring. The markets consider these safe havens in case of a US default. If a default occurs August 2, 2011 onwards, the Tea Party will be to blame for creating havoc with US and World financial systems.
The debt ceiling was raised 17 times under Reagan, 4 times under Bush Sr. 4 times under Clinton and 7 times under Bush Jr. The Republican Party has only now developed consciousness or is it that their game play has gone too far?
The Tea Party's ideology is warped. In a country where every dollar spent, only 62 cents are raised in revenue and the rest is borrowed, Tea Partiers refuse to increase revenue sources. Granted that US spending is out of control and needs to be reigned in, but most of the extra spending in last ten years has been on expensive wars.
The Republican lawmakers who rave and rant against Government spending are themselves guilty of appropriating funds by way of entitlements for their pet projects, whether these are productive or not - like the bridge to nowhere in Alaska. They tag entitlements to any bill that passes Congress.
Although this fight between Tea Party and President Obama seems mostly ideological, but there may be some undercurrents of racism here. In 2010 elections, some Tea Party zealots suggested that African Americans should not vote as they don't understand democracy. It seems that Tea Party has a one point agenda - remove Barack Obama from office, no matter what the cost to country's economy.
To prevent default, if moderate Republicans do come to a last minute agreement with President Obama, Tea Party may try to stall the bill in Congress. If they cannot, they will probably field their own Presidential candidate in 2012. This could rip the Republican Party as their votes will split against Obama.