Debt Ceilings and why they shouldn’t be the main focus

So the complaint against my last blog on why raising taxes won’t work was that taxes and spending weren’t the only issue. There was that whole debt ceiling thing.

So let’s talk about the debt ceiling.

Why do we have a debt ceiling? Probably to have a line that says “oh look, if you’re this far in debt you’ve totally !@#$ed the economy. Don’t spend this much! If you’re getting this close, stop spending, start cutting. This is not a line you can go past. Stop spending you moron!” It’s kind of like that line your banks has drawn called zero funds…it’s just terrible to go past that line.

So did Congress stop spending when it got close to that line? Nope. Not even close. Being a group of lobotomized monkeys Congress just raised the limit. How many times did they raise it you ask? Well according to CNN:

“Since March 1962, the debt ceiling has been raised 74 times, according to the Congressional Research Service. Ten of those times have occurred since 2001.”

I don’t have enough money. Let me get 74 high interest credit cards to pay my debts and never worry about how much I’m spending.

Seems like a spectacularly great idea. I’m sure it would have no long term consequences.

So let’s just raise the debt limit again because that line of how much we owe keeps going up. We can just raise the debt limit again if we need to. One more credit card won’t hurt.

But then some people are having a really fun time explaining this new raising of the debt ceiling. Yes we realize when the national debt (14.29 Trillion) exceeds the national GDP (14.1 Trillion) things might be a little insane, for this the 75th raising of the debt ceiling Congress has been adding the phrase “but this will be the last time.” (Actually, I could be wrong but I don’t think they’ve actually said it, they’ve more or less just implied it).

Ah yes, this is the last one argument. Like a smoker who says this next cigarette will be the last cigarette I ever have—I’m quitting tomorrow. This next one will be the last shot of vodka I ever have—tomorrow I’m going to AA. This next time is the last time I’m shooting up black-tar heroin—I’m quitting cold turkey tomorrow. You believe them. When this next time will always be the last time, somehow there always seems to be a next time. There’s always just one more. It’s just one, what could it hurt. The only way you ever quit any bad habit is when you look at the last time you did that and say THAT was the last time. So let me just suggest that the last debt ceiling increase actually be the last one.

Or you know what, I’ll be reasonable and admit economics is much more complicated. I’ll admit that perhaps we’ve already made certain deals and have certain obligations we can’t immediately get out of. So how about this, we will agree to raise the debt ceiling IF AND ONLY IF a budget plan that will cut 6 trillion off the debt in the next 5 years is put into place so it looks more like the graph to the left. And this new debt increase will come with a six month sunset clause. I might agree to that.

Because if we just think that raising the debt ceiling is the answer to anything, I would remind you two days ago I proved if we raised the debt ceiling 1.4 Trillion Dollars we would only be able to pay our bills until Christmas. Clearly spending, not the debt ceiling, not taxes, but spending is the issue here.

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Filed under Budget, Capitalism, Debt, Economics, People Are Stupid

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