http://online.wsj.com/article/SB1000142 … 63786.html
I heard a good argument against the raising the debt ceiling a few years back. This senator argued leadership means that ''the buck stops here. Instead, Washington is shifting the burden of bad choices today onto the backs of our children and grandchildren."
This makes sense - allowing the debt to increase is only akin to subsidising the current generation at the expense of future ones, and is in effect theft of the unborn. It has moral and practical problems - how long can it go on?
The point arguably has further weight now than it did back in 2006 when this speech was made, seeing as the debt is now twice as large. But who was this seer that so accurately pinpointed grave economic problems?
Oh, Barack Obama.
Why is it that as soon as they are in political office, previously half-intelligent people's brains fall out?
In other news, default is not an undisputed outcome if the debt ceiling does not rise:
http://consultingbyrpm.com/blog/2013/10 … iling.html
One can often make a good case for raising the ceiling, as well. Future generations will absolutely benefit from keeping invaders out of the country. They will benefit from better infrastructure constructed today. They will benefit from better education. They will benefit from pure research in almost anything.
But supporting people that don't want to work doesn't do much for our kids. Supporting millions of illegal aliens doesn't do much for them. Buying elections with pork barrel spending doesn't benefit my kids anything at all. But allowing idiots to hold the office of leaders, idiots that care nothing for the country or the people, does do something although it is not positive.
You want your child to be successful, so you set him up so that when he turn 18, he has a $25,000 car debt and a $200,000 house debt, right?
Look at the healthcare website. $93 million dollar contract to build a website that is only designed to handle 50,000 people at a time. If a private company spent money that way, they wouldn't survive.
Everything the gov touches turns to bloat, and we would only need to cut 20% to have a balanced budget.
Not sure what children choosing to play their way through college has to do with giving money to them, but I think such a child is foolish in the extreme and decline to support their play time. Also don't see a reason to purchase the child a nice big house - we already see the result in the recession of that decision.
Yep - government can never get it right. They have an unlimited pocketbook and no incentive to be efficient, so they make no effort. Should we then raise the debt ceiling to accommodate them?
You're forgetting that future generations have no choice in the matter. Regardless of whether you believe the amount spent on the military and infrastructure is beneficial to them, it's not fair to make that decision on their behalf - that's dictatorship. And I simply don't believe that government spending in the excess it's in today is done under the pretence of providing infrastructure for the future, I believe it is closer to what you are saying (giving out free stuff) for votes - short term gain.
So shall a 6 year old pick their own school? Shall they decide if they would rather have a shiny new toy or a new road? Between a new water treatment plant (giving health to all) and a new swingset, does the child make the decision? Of course we make the calls of what is in the best interests of future generations. They are not capable of doing so.
And no, our excessive spending is NOT designed to provide a better country, now or later. It is designed to buy votes to enrich our wondrous "leaders".
Children don't pay taxes. When these children grow up, they have to pay the tax necessary to pay off the debt on the basis that their parents and grandparents voted for people that borrowed so much. That's adults making decisions on behalf of other adults, not just children.
I agree on all counts.
If we ignore 'debt revenue', our current interest payments are about 10% of our income. I'm sorry, but that's already ridiculous. The rate we're going, it will soon be much more, and be truly unsustainable.
If the Obama administration chooses to default(because I also agree that we won't be forced to), then that will only make things worse. Interest rates for new debt would skyrocket, as nobody wants to lend to a bad risk.
With the state of so many large countries being so precarious, I'm afraid that much of the world is in for a long, painful time.
That is a good argument for balancing the budget and paying down debt. But if the USA permanently defaults on loans what you leave the next generation is a recession that makes the 1930s look like Disneyland.
If every citizen agreed to only vote for a party that planned to balance the budget, we would have 1 or 2 completely new dominant parties pretty much overnight.
Default is by no means a certainty, and in-fact unlikely at this point (check the link at the bottom of the OP), so the fears are unwarranted. Raising the debt-ceiling will provide all the more incentive for government to borrow and spend more, at which point a recession would be necessary to correct these wrongs and prevent it getting worse. Unfortunately due to the irresponsibility of politics we cannot come through this without pain, and we have to prefer a policy of short-term pain for long-term gain instead of postponing it for a greater disaster in the future.
If you don't make steps to curb borrowing and spending, politicians are not going to do it of their own accord.
Not raising the debt ceiling will lead almost certainly to default given the current state of congress. The payment would fall due and we would not be able to make it. That is pretty black and white. retain debt ceiling = default. Any other outcome is extremely implausible as it would require a functioning house and senate.
Thus the debt ceiling needs to be raised. Then we need to stop voting for people who can't make a balanced budget. Isn't that something he keep the conservatives around for? The we can true to run in surplus and pay down debt. In that order.
(Going into default would cause cascading effects of the following months that would crash the stock market, the ability to offer any loans, the insurance market and just get worse after that).
No, it doesn't mean default.
Go read what Moody's said about it.
The government will still be bringing in $2.5 trillion, and is Constitutionally required to pay its debts, so there is no reason for it not to pay interest.
We don't have to raise the debt ceiling to pay the interest. Unbelievable what people believe. If you were making $250,000, would you need a line of credit to be able to pay your $20,000 credit card bill?
Or, could you pay your credit card bill and stop eating at the Savoy every day?
Did you just use a racial slur? I know you didn't , but your argument is the tantamount to my saying so. Default means you have no money to spend on your debt. It is entirely different than having the money and being told you have to increase your spending to balance your budget.
Definition of a balanced budget. Amount of money saved + spent= amount of money earned
The government is not going to be shut-down anywhere near long enough for that to occur - for the third time now, read the article. There is plenty of revenue right there if anyone dared to use it.
"Then we need to stop voting for people who can't make a balanced budget."
Easier said than done - every candidate wants to balance the budget but that hasn't occurred in how long? There's a time where we can't afford to dance around the problem anymore.
Default is actually a statutory impossibility. There is sufficient revenue collected by the Federal government each month to service the debt and laws that require the Executive to make the payments. That having been said, statutory imperatives have little influence on an Executive who ignores the very law he touts as his great accomplishment. Obama has run rough shod over his eponymous health insurance debacle.
It amazes me that from this conversation not a single person seems to know what the debt ceiling is.
Raising the debt ceiling authorizes the government to pay on money that has already been spent. Congress already has authorized the spending of this money. The money has already been borrowed. The money has already been spent. Raising the debt ceiling is about paying on debt that we ALREADY HAVE!
So a good analogy would be a set of parents who had gotten themselves into horrible credit card debt. One parent wants to pay off the credit card debt but the other one just decides that they shouldn't do it. "If we pay off this credit card it will just encourage more credit card spending in the future," the parent says. "It will be better for our children if we just don't pay off our debt."
Incidentally, it is the Republican party who gave us most of this debt in the first place.
Is this just a typical talking point (as I suspect) or can you site a source? Since all spending is the Constitutional responsibility of the House of Representatives, I find it interesting to blame Republicans when Democrats have had control of the House for more years in the past 100 than Republicans.
No, the money hasn't already been borrowed. The debt ceiling is a limit on how much debt(notes and bonds) the treasury can issue.
Every month, the government takes in revenue, and has expenses to pay. The treasury issues notes and bonds to bring in the revenue needed to make up for the difference between the two.
Raising the debt ceiling has nothing to do with paying our actual debt. It has to do with paying obligations and discretionary expenditures.
Why does the government have the power to decide this anyway? Imagine if the debtor could decide what the borrowing limit would be on a credit card - that wouldn't cause many problems at all would it?
You must stop being reasonable or sensible. Don't you know that the government is the wellspring of all goodness?
You're right, I think we should all keep in mind that if it wasn't for government, there wouldn't be enough sunshine for the world to be habitable.
by Susan Reid 12 years ago
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