US Debt Ceiling again, point, raise, really

rkapoor

Do we really need a debt ceiling at all?

What's the point of it if we're foreced to raise it time and time again?

AndyNZ

been raised 70+ times since inception, 10 times since 2001 I think. its suppose to make us think about spending but it is not working lol

maratikus

Or...maybe the Fed can give the GOTUS debt relief, and forgive the debt they hold. The amount of debt would come down right?


*runs away*

stockjaguar

it's almost like saying you'll quit smoking... tomorrow

stockjaguar

The debt ceiling is a historical relic which should be eliminated. That either political party would use it as a bargaining chip for anything is extremely dangerous - even the USCoC has come out and said "raise it immediately, and without drama".

brain_wash_your

What's great about the debt ceiling, particularly to the politicians on the right, is that it creates the illusion of being serious.

grharmeyer

bchadwick Wrote:
-------------------------------------------------------
> What's great about the debt ceiling, particularly
> to the politicians on the right, is that it
> creates the illusion of being serious.


hehehe

parott

It was created by the Second Liberty Bond Act of 1917. Before this act, the Treasury had to go to Congress each time they wanted to issue new bonds. Congress had to vote for and approve a new bond issuance every single time and agree on the amount, maturity, coupon, etc. This was obviously burdensome and politics would get in the way. During WWI people realized this process couldn't continue so they gave the Treasury the ability to issue $X amount of bonds (the debt ceiling) whenever they wanted and with whatever characteristics they thought to be best. A formal debt ceiling was established in 1939. Most countries don't have a debt ceiling. It was Congress' way of maintaining some power over the issuance of debt.

That's the jist of it.

Slight detour: In Perry v. United States, the Supreme Court ruled that Congress does not have the power to void US government bonds on account of section 4 of the 14th amendment. Bruce Bartlett, an Economist, believes this allows the President to void the debt ceiling and tell congress to go fudge itself. He wrote an article about it a few weeks ago. I'm not a lawyer, but this doesn't seem like it's too crazy of an idea and Obama should look into it if it gets closer to the deadline.

On another note: I don't like how we can't curse on this forum.

Walex

I can't find it now, but I know I read an article that the debt ceiling increase was pushed through Congress several times under the GWB administration by Republicans and fought against by Dem's every time, and now with Obama as POTUS, it is the exact opposite. Just proves that it is truly meaningless and only a partisan issue when it is convenient.