The Runback: Time to Abolish the Debt Ceiling
The Debt Ceiling is merely a token limit on federal spending that gets blasted through anyway. So if the debt ceiling is merely a symbolic token, what’s the point anymore?
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News and Politics
Moore Fumbles Transportation Pick: Wes Moore is showing a serious lack in judgment by appointing failed Transit Administrator Paul Wiedefeld as Transportation Secretary.
Montgomery GOP Offering Peroutka Class Again: It's nearly Sisyphean for a Republican to win there, and yet the Montgomery County Republican Party apparatus thinks it is helpful to associate themselves with radical kooks with extremist ties.
Harris Skips RNC Meeting: The new Maryland Republican Party Chair was not present at the meeting that elected Ronna Romney McDaniel to a 4th Term
The Monday Thought
We are once again in everybody’s least favorite time of year: debt ceiling season!
The United States hit the debt ceiling on January 19th, reaching a debt of $31.4 TRILLION dollars.
By law, Congress sets the absolute limit that the Treasury Department can issue debt for. Now that the ceiling has been reached, Treasury is doing what basic amounts to accounting tricks in order to continue issuing debt until a hard ceiling is reached during the Summer.
Fortunately, nobody in government has brought up the Trillion Dollar Coin again this go around. Though people are indeed talking about it.
Somebody in Congress is going to have to budget and do something. But that’s where the problems start:
But what is the Republican plan? Other than calls for spending cuts, the GOP details remain nebulous, and Democrats have quickly used that uncertainty to make a familiar charge.
“Now they’re gearing up to slash Medicare and Social Security benefits for millions of Americans,” said U.S. Rep. Nikema Williams, D-Atlanta.
While Democrats issue those kinds of warnings, they have no plans of their own to hold back on spending or balance the budget.
“I think what we have to do is realize that we have a problem,” said U.S. Sen. Joe Manchin, D-W.Va., one of the few Democrats calling for fiscal restraint.
Entitlement spending is one of the reasons we have reached this point. 60% of federal spending goes to cover Social Security, Medicare, and Medicaid. Only 30% of the budget goes to everything else. (The remaining amount goes to service our national debt). But there is no plan to reduce discretionary spending, entitlement spending, or much of anything else, including accumulating even more debt.
The debt ceiling is not the problem in this scenario. It’s Congress’s addiction to spending and creating new debt that’s the problem.
However, the ramifications of now raising the debt ceiling are enormous. Downgrading the credit of the U.S. Government. Market uncertainty. Currency devaluation. And an economic crisis that will dwarf the most recent recession.
The problem is clear: Congress needs to do away with the debt ceiling.
Doing away with the debt ceiling is a hard pill to swallow for somebody like me who two years ago said that the national debt is a national security issue. It still IS a national security issue. But this game of chicken that Congress keeps playing proves the point that the debt ceiling is little more than Kabuki Theater anyway. Everybody plays their part, everybody makes the same talking points, the debt ceiling gets raised, and Congress and the White House continue to create new debt. Rinse, repeat.
The Debt Ceiling is merely a token limit on federal spending that gets blasted through anyway. So if the debt ceiling is merely a symbolic token, what’s the point anymore?
We’ll never go back to the old days when Congress had to authorize each debt issued by the Treasury Department. And there are serious concerns about runaway debt if the debt ceiling is permanently suspended. But it would make Washington less susceptible to the stupid political stunts that we are about to witness as Congress hems and haws before the inevitable debt ceiling extension.