On July 9, 2011, Republican extortionists threatened the Nation with financial ruin and international disgrace unless their demands were met. They refused to raise the debt ceiling unless Democrats agreed to massively cut social programs for the elderly, poor and disabled.

If Congress failed to raise the borrowing limit of the federal government by August 2, the date when the U.S. reached the limit of its borrowing abilities, it would begin defaulting on its loans.

As Warren Buffett, CEO of Berkshire Hathaway, explained the looming economic catastrophe: “If you don’t send out Social Security checks, I would hate to think about the credit meeting at S&P and Moody’s the next morning.

“If you’re not paying millions and millions and millions of people that range in age from 65 on up, money you promised them, you’re not a AAA,” said Buffett.

 Warren Buffett

A triple-A credit rating is the highest possible rating that can be received.

And while Republicans demanded that the disadvantaged tighten their belts, they rejected any raising of taxes on their foremost constituency–the wealthiest 1%.

To raise taxes on the wealthy, they insisted, would be a “jobs-killer.” It would “discourage” corporate CEOs from creating tens of thousands of jobs they “want” to create.

Republicans knew this argument was a lie. And so did the editors of Time. The difference between them: The editors of Time were willing to reveal the truth.

In its June 20, 2011  cover-story on “What U.S. Economic Recovery? Five Destructive Myths,” Rana Foroohar, the magazine’s assistant managing editor in charge of economics and business, delivered this warning: Profit-seeking corporations can’t be relied on to ”make it all better.”

Wrote Foroohar:

“There is a fundamental disconnect between the fortunes of American companies, which are doing quite well, and American workers, most of whom are earning a lower hourly wage now than they did during the recession.

“The thing is, companies make plenty of money; they just don’t spend it on workers here. 

“There may be $2 trillion sitting on the balance sheets of American corporations globally, but firms show no signs of wanting to spend it in order to hire workers at home.”

As the calendar moved ever closer to the fateful date of August 2, Republican leaders continued to insist: Any deal that includes taxes “can’t pass the House.”

One senior Republican said talks would go right up to–and maybe beyond–the brink of default.

“I think we’ll be here in August,” said Republican Rep. Pete Sessions, of Texas. “We are not going to leave town until a proper deal gets done.”

President Obama had previously insisted on extending the debt ceiling through 2012. But in mid-July, he simply asked congressional leaders to review three options with their members: 

1. The “Grand Bargain” choice—favored by Obama–would cut deficits by about $4 trillion, including spending cuts and new tax revenues.
2. A medium-range plan would aim to reduce the deficit by about $2 trillion.
3. The smallest option would cut between $1 trillion and $1.5 trillion, without increased tax revenue or any Medicare and Medicaid cuts.

And the Republican response?

Said Rep. Darrell Issa, chairman of the Oversight and Government Reform Committee: “Quite frankly, [Republican] members of Congress are getting tired of what the president won’t do and what the president wants.”

Noted political analyst Chris Matthews summed up the sheer criminality of what happened within the House of Representatives.

Speaking on MSNBC’s “Hardball,” on July 28–five days before Congress reached its August 2 deadline to raise the debt-ceiling–Matthews noted:

“The first people to bow to the demands of those threatening to blow up the economy were the Republicans in the House, the leaders. The leaders did what the followers told them to do: meet the demands, hold up the country to get their way.

Chris Matthews

“Those followers didn’t win the Senate, or the Presidency, just the House. But by using the House they were able to hold up the entire United States government. They threatened to blow things up economically and it worked.

“They said they were willing to do that–just to get their way–not by persuasion, not by politics, not by democratic government, but by threatening the destruction of the country’s finances.

“Right. So what’s next? The power grid? Will they next time threaten to close down the country’s electricity and communications systems?”

With the United States teetering on the brink of national bankruptcy, President Obama faced three choices:

1. Counter Republican extortion attempts via RICO–the Racketeer Influenced Corrupt Organizations Act.
2. Make a “Cuban Missile Crisis”-style address to the American people, seeking to rally them against a criminal threat to the financial security of the Nation.
3. Cave in to Republican demands.

Unfortunately for Obama and the Nation, he chose Number Three.

But he could have countered that danger via the Racketeer Influenced Corrupt Organizations (RICO) Act.

In 1970, Congress passed RICO, Title 18, United States Code, Sections 1961-1968. Its goal: Destroy the Mafia.

U.S. Department of Justice

RICO opens with a series of definitions of “racketeering activity” which can be prosecuted by Justice Department attorneys. Among those crimes: Extortion.

Extortion is defined as “a criminal offense which occurs when a person unlawfully obtains either money, property or services from a person(s), entity, or institution, through coercion.”