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Should The U.S. Have A Debt Ceiling?

Should the U.S. have a debt ceiling?

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pbrauer

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Should the U.S. have a debt ceiling?

Yes
No
Onion Bagel
 
Yes, since it is part of the mechanism which allows the Treasury to provide the funds specified by the federal budget without forcing congress to individually authorize bond issues in addition to the passing budget.

It's just an administrative tool which has only been hijacked for political purposes due to its name.
 
No, we shouldn't have a debt ceiling, the amount that we borrow should be defined by market forces, not by some arbitrary figure. Our debt cannot be questioned.
 
I honestly don't understand the issues involved well enough to have an informed opinion.
 
StillBallin75 said:
what exactly does this mean??
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When you borrow too much money, your interest rates will climb or perhaps no one will lend you any money, this is market forces in action. Loans are granted upon the lenders perception on the borrowers ability to repay the loan. The higher the risk, the higher the interest rate the borrower must pay.

Our debt should be handled the same way, IMO. Our debt ceiling for any particular year, is the budget the President signs each year. The House defines what we are willing spend, the President signs it, the House should not be able to turn around and say we will not pay for our debt.
 
What the USA needs is moderation and a moderate approach to all our problems...the far left and the far right need to be ostrisized outted and condemned...because they have much to do with destroying the place I love
 

The budget formulated by Congress and signed by the President is hardly a "market force." Market forces depend on the spontaneous organizing and resource-allocation abilities of the price mechanism (invisible hand). The federal budget rests in the hands of a select group of individuals. "Market forces" don't decide what our debt/deficit is, people do.

And while it is generally true that if you borrow too much money, your interest rates will rise due to lack of confidence, by the time our government decides to fix the problem it is likely too late. For the past God knows how many years, the amount of interest we have to pay on the debt has been increasing steadily. If what you said were the case, politicians would be forced to cut spending the moments that portion of the budget started rising dramatically at this point. They haven't.

Not to mention, when it comes to sovereign debt, the US is a special case among sovereign nations in that the dollar is used as the de facto international reserve currency. That gives us certain advantages when it comes to spending beyond our means, but it also means that we have less of an incentive to get things under control because we assume that people are just going to be confident in the US and its economy for the foreseeable future. One day, you could be fine and be borrowing all the money you want, the next day all your investors might suddenly turn on you and interest rates go through the roof, eventually resulting in a default. That would be rather disastrous.
 
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Not only should there be a debt ceiling, but it should be very difficult to increase. Of course there should also be a balanced budget amendment which forces government to live within its means.
 
Ockham said:
Not only should there be a debt ceiling, but it should be very difficult to increase. Of course there should also be a balanced budget amendment which forces government to live within its means.
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So you want the President and Congress to authorize expenditures and have no way of paying for them? That doesn't seem very smart to me.
 

Regardless of WHY it was hijacked for political purposes, the fact remains that it was. And that's unacceptable, and antithetical to good governance.

Furthermore, we don't need to use it as an administrative tool in order to avoid authorizing individual bonds. Our nation didn't have it until World War I...and no other nation in the world has a debt ceiling at all (except for Denmark, which only has it in theory). It's just assumed that when Congress authorizes the Treasury to spend a certain amount of money and collect a certain amount of taxes, that the difference will need to be borrowed.

The debt ceiling is an entirely redundant mechanism. If the government doesn't want to borrow so much money, it can vote to cut spending and/or raise taxes at any time.
 
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pbrauer said:
So you want the President and Congress to authorize expenditures and have no way of paying for them? That doesn't seem very smart to me.
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I want the President and Congress prevented from authorizing expenditures they have no way of paying. That is very smart. What's stupid and moronic is a government which has a blank check to spend taxpayers money. I don't think there's a word in a the English language that can express that kind of stupidity enough.
 
Ockham said:
I want the President and Congress prevented from authorizing expenditures they have no way of paying.
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Fine, how do you propose to stop them from spending too much? The debt ceiling tactic is a colossal failure.

That is very smart. What's stupid and moronic is a government which has a blank check to spend taxpayers money. I don't think there's a word in a the English language that can express that kind of stupidity enough.
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According to the Constitution, the House has the purse strings and unless a veto is overridden by Congress the spending becomes law.

Are second guessing the Founding Fathers? :roll:
 
Ockham said:
Not only should there be a debt ceiling, but it should be very difficult to increase. Of course there should also be a balanced budget amendment which forces government to live within its means.
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I'm one of those people who thinks that it's a better idea to have a balanced budget over the business cycle (Keynes suggested that the government save during good times and spend during the bad), rather than on an annual basis.
 
pbrauer said:
Fine, how do you propose to stop them from spending too much? The debt ceiling tactic is a colossal failure.
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How can not raising the debt ceiling be a failure if it's never been tried?

pbrauer said:
According to the Constitution, the House has the purse strings and unless a veto is overridden by Congress the spending becomes law.

Are second guessing the Founding Fathers? :roll:
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The constitution says nothing about borrowing trillions from foreign countries. Most of what's done in the U.S. Congress and by the Presidents these days is not supported constitutionally. You must be quoting John Kerry... who apparently had a seance in the Capitol and was told by the ghosts of our founding fathers that cut cap and balance is a bad thing. I mean... a balanced budget? What a radical and excessive idea!! :lamo

Don't start quoting the founder when it's not your forte. Stick with the liberal progressive talking points from DailyKos and MoveOn.org and don't go off script.
 
yes to the ceiling
based on a percentage of government income...Very smart people will have to determine this percentage.
All waste (wars) must be stopped.
If we have less crime, then we must have fewer cops.
And, we must know why we have the less crime...People must be placed where they can do some good..
A "balanced budget", at this time is a poor idea....
Why ?
Take an uneducated man, a young uneducated man as an example.
His income is $1,000 per year; but his potential, with $10,000 of proper training , is $10,000 per year...
A nation can be the same way, but with a "balanced budget", it will stay poor...
Needless to say, this "proper training" has to be done most carefully.
 
Yes, we should; and it should be $5.00.
 
Ockham said:
How can not raising the debt ceiling be a failure if it's never been tried?
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It's a failure because it's NEVER stopped spending. The way to stop spending is with budget battles. It's simply wrong for the President and Congress to authorize spending and then turnaround say you can't borrow money to pay for it.

An amendment to the Constitution ultimately requires 3/4 or 38 states to vote for it, so how does the House Bill ensure this? Long answer: It doesn't, Cut, Cap and Balance is nothing more than politics.
 
cut cap and balance is where we will end up

maybe not because we want to.

but because we will get to the point where there is no choice.
 
pbrauer said:
It's a failure because it's NEVER stopped spending. The way to stop spending is with budget battles. It's simply wrong for the President and Congress to authorize spending and then turnaround say you can't borrow money to pay for it.
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The obvious (and I use that term loosely since I have to take account of who I'm speaking with here) then way to control spending is to not authorize it. Rubio was 100% correct on the Senate floor when he said history has proven, give government the ability to spend beyond their means and they will. Therefore a balanced budget amendment and a ceiling cap on spending is the only way to control the amount of spending such that, government doesn't borrow more than it can pay back.

I'm glad you agree with me.


pbrauer said:
An amendment to the Constitution ultimately requires 3/4 or 38 states to vote for it, so how does the House Bill ensure this? Long answer: It doesn't, Cut, Cap and Balance is nothing more than politics.
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It will take however long it will take... it's what we in the business world call... a "long term goal". If it takes 2 years or it takes 12 years it must be done.
 
cpwill said:
cut cap and balance is where we will end up

maybe not because we want to.

but because we will get to the point where there is no choice.
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How??????????????
 
LOL, it didn't even get the 2/3 vote required in the Republican controlled House for passage. It's not a long term goal, it's a pipe dream. Even some of the most reddish states would not vote in favor because they like sucking of the Federal teat as much (maybe more) as anyone else.
 
Some facts about the debt ceiling hysteria

FACT 1

The debt ceiling... gawd this is a freaking joke, isn't it? Currently it's viewed as a debt ceiling beyond which we will not borrow any more money.... Yet we will consistently overspend those limits, and just as consistently raise those limits. WHAT IS THE POINT OF WASTING TIME VOTING ON THIS WHEN IT HAS NO PURPOSE TO BEGIN WITH? If it does not serve as an impedance to spending, or even a guideline, it serves no useful purpose. Abolish it or change it.

This was a law enacted in 1917 to perform an end run around budget restrictions that could hamper our efforts in the Great War, and to allow for more "flexible" borrowing by congress. It was then a justification for a fundamental change in how congress borrowed, and is now just a formality. It was replaced by laws passed in 1939 and 1941, and finally aggregated into a single piece of legislation.


FACT 2

Congress, by it's own rules, began automatically raising the ceiling when passing a new budget in 1979, no vote required, simply the passage of a new budget. Any past purpose it might have had (and it had none) died that day. It should have been abolished or repealed. Of course, getting rid of it would remove the extremely thin veil of responsibility our public servants project by admitting they really don't care how much they spend, or these days, how fast. However, it was at this time, and every time after 1979 that we'd missed the opportunity to have the debate that is happening now, during such highly charged and dangerous situations, created by the very people who are asking us to trust them, they can fix this.

FACT 3

The Tea Party - On the one hand, it's a debate that has been long coming, and the TP should be credited for making all of us take a look at something that has not served the people well outside of two world wars, and which we have been completely ignorant of until now. But if you all miss the larger, more important underlying issues, what will have been the point?

On the other, this minority movement (20%) of the flailing and faltering republican party, is holding America hostage. They have used this very crucial time, not just to make a point, but to hold hostage what remains of personal wealth among the average citizen, and further threatening to wreak havoc on the entire world if we default on something that should have been discussed during the last budget, and the one before that, and the one... you get the idea. The rest of the republican party and the rest of the nation should be exerting considerable pressure on them to back the hell down and take up this debate as part of the election platform, and we'll see what merit it has.

FACT 4

Default - Not gonna happen. If it did, we would deserve more scorn heaped on us as a people by the citizens of the world than we experienced with Bush. If we default, we affect the world economy, if we don't, but still see a downgrading in our securities rating, that only largely affects us. And we deserve it.

With an administration so heavily invested in Wall St appointees, there is little chance that a default is in the realm of possibilities... unless it benefits them to do so. If a default happens, I would be very skeptical as to the reasons why.

We can all spend our lives pointing fingers at this political party or that, to this law maker or that, all while collectively scratching our heads (or asses) wondering how we got here (more likely not wondering at all, see scratching ass). The fault with all of this lies with us, the People. We are the rulers of this country. We have failed to demand accountability of our elected public servants. We have allowed ourselves to be divided from our first responsibility, remain skeptical and vigilant of our government, and when it stops working for the People, change it.

FACT 5

The drama over the 14th Amendment. Using the constitution, requiring some manner of interpretation where specifics are absent, is always dangerous when setting precedent. I advise against it, and it is unnecessary. The President can accomplish the same thing using an Executive Order to raise the debt ceiling to avoid crisis and returning the power to congress when and if they get their act together.

Executive Orders are generally used "as the authorization allowing for their issuance to be justified as part of the President's sworn duties,[1] the intent being to help direct officers of the US Executive carry out their delegated duties as well as the normal operations of the Federal Government"

The debt ceiling would certainly fall within this description without having to mess about with the constitution and setting dangerous precedents.
 
pbrauer said:
How??????????????
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you know that "real debt ceiling" you talk about? we're going to hit it. and we are going to find out very quickly that you can't get tax revenue above 20% of GDP with any kind of consistency, and you can only get there when you are willing to have low flat rates.

we're going to have to balance, and that is going to first force us to cut, and then to cap our spending.

we will be going backwards, and it will be very painful.... but that's the alternative to doing it now.
 
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