Wednesday, April 6, 2011

Government Shutdown To Close IRS: Sorry, No Tax Refunds

In order to make the biggest strawman so far in 2011 really scary and nasty, the administration just announced that as part of a government shut down, the IRS would end up being closed. While according to some this is the ulterior motive all along to avoid the premature outflow of tens of billions in cash due to federal tax refunds hitting the IRS next week, which without a debt ceiling hike would push the country into technical default possibly as soon as next week (debt subject to the limit was $14.2 trillion two days ago, just $94 billion under the ceiling and with about $74 billion in debt to be issued next week a $20 billion tax refund withdrawal would push the Treasury over the limit), what is far more amusing is that as the WSJ reminds us, the Fed would still be able to monetize debt regardless if the government was operating or not. Ergo nothing can end POMO ahead of time, not even a complete US government shutdown.

-- Read more from Zero Hedge

More Details On What Government Shut Down Would Look Like

  • *DJ Obama Admin Says IRS Would Shut Down If Budget Not Passed
  • *DJ Obama Admin Says National Parks, Smithsonian Would Close
  • *DJ Obama Admin: Cherry Blossom Festival Wouldn't Happen If Budget Not Passed
  • *DJ Obama Admin: Roughly 800,000 Govt Employees Would Be Affected By Shutdown
  • *DJ Obama Admin: EPA Permitting Would Stop If Budget Not Passed
  • *DJ Obama Admin: Social Security Beneficiaries Would Continue To Receive Payments
  • *DJ Obama Admin: Electronic Tax Refunds, Collections Would Continue
  • *DJ Obama Admin: Military, Law Enforcement Will Continue To Function
  • *DJ Obama Admin: Military Personnel Would Earn Paychecks, But Not Receive Them Immediately
  • *DJ Obama Admin: White House Staffing Would Be Lower During Shutdown
  • *ZH: POMO will continue come rain or snow: Russell 36,000 will not be denied, US bankruptcy notwithstanding

US Government propaganda cartoon from WWII era.