Little-Acorn
Well-Known Member
If the Debt Ceiling doesn't get raised, what will the Obama Admin do? Simply start violating the Debt Ceiling law? That would be consistent with their other responses to laws they don't like, particularly that one written in 1789. Or will they actually stop borrowing money at that point?
If the ceiling doesn't get raised, it will be the equivalent of an instant Balanced Budget Amendment (excpt this one isn't a Constitutional amendment). From this point on, govt can't spend more than it takes in, period. It would have to borrow money to do so, and borrowing is no longer permitted.
Remind me again, why this would be a BAD thing?
Will the Obama admin start violating the law, and keep borrowing (getting loans, selling bonds, stealing from Medicare and Social Security, etc.)? Or will they raise taxes hugely (would this actually bring in that much money, or would it merely reduce the economic activity that gets taxed?)? Or will they actually stop spending as much as they had planned to?
If the latter, which programs might they cut down spending on?
Some people fear they will stop paying interest on the money they have already borrowed, and/or refuse to redeem debt when it becomes due, as various parts of it do every day. This would shatter the country's financial structure in a blink, and send our credit ratings down the drain intantly. Plus, those green pieces of paper in your wallet might suddenly be worth a lot less. You didn't need to buy groceries tomorrow after all, did you?
Or, might they announce that all govt workers, or maybe all except military, will suddenly get a 25% reduction in pay, and if they don't like it they can quit. Or perhaps, cut non-military govt pensions by 25% (or more).
Or, might they announce that all payments for Medicare, Social Security, Railroad Retirement, and all the rest of the things govt is paying for, will get the 25% reduction. Watch for low-flying pigs if that happens (it ain't a-gonna).
What WILL they do?
We can no longer avoid this debate. It starts hitting the fan TODAY, Monday, May 16, 2011.
Here's a thought: How about getting out that dusty old law written in 1787, plus all its amendments since, and seeing which govt programs are explicitly authorized in it (as required by its 10th amendment)... and start applying the 25% cut to all the ones that aren't? And if that's not enough, a 30% cut... or 35%.... etc.
Sound like a plan? If not, then what do YOU suggest they do if the Debt Ceiling is not raised?
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http://online.wsj.com/article/SB10001424052748703421204576325583050561022.html
As Debt Limit Reached, Agreement Still Far Off
By DAMIAN PALETTA And CAROL E. LEE
May 16, 2011
WSJ's Paul Vigna reports the nation's nearly $14.3 trillion debt ceiling will be breached today. Also, NASDAQ withdrew its bid for the NYSE.
The U.S. government is expected to hit the $14.294 trillion debt ceiling Monday, setting in motion an uncertain, 11-week political scramble to avoid a default.
The Treasury Department plans to announce Monday it will stop issuing and reinvesting government securities in certain government pension plans, part of a series of steps designed to delay a default until Aug. 2.
The Treasury's moves buy time for the White House and congressional leaders to reach a deficit-reduction agreement that could clear the way for enough lawmakers to vote to raise the amount of money Congress allows the nation to borrow.
Gene Sperling, director of the National Economic Council, said reaching the debt ceiling "should be a warning bell to the political system that it's time to get serious about preserving our full faith and credit." The Obama administration says a default would tip the U.S. back into a financial crisis.
If the ceiling doesn't get raised, it will be the equivalent of an instant Balanced Budget Amendment (excpt this one isn't a Constitutional amendment). From this point on, govt can't spend more than it takes in, period. It would have to borrow money to do so, and borrowing is no longer permitted.
Remind me again, why this would be a BAD thing?
Will the Obama admin start violating the law, and keep borrowing (getting loans, selling bonds, stealing from Medicare and Social Security, etc.)? Or will they raise taxes hugely (would this actually bring in that much money, or would it merely reduce the economic activity that gets taxed?)? Or will they actually stop spending as much as they had planned to?
If the latter, which programs might they cut down spending on?
Some people fear they will stop paying interest on the money they have already borrowed, and/or refuse to redeem debt when it becomes due, as various parts of it do every day. This would shatter the country's financial structure in a blink, and send our credit ratings down the drain intantly. Plus, those green pieces of paper in your wallet might suddenly be worth a lot less. You didn't need to buy groceries tomorrow after all, did you?
Or, might they announce that all govt workers, or maybe all except military, will suddenly get a 25% reduction in pay, and if they don't like it they can quit. Or perhaps, cut non-military govt pensions by 25% (or more).
Or, might they announce that all payments for Medicare, Social Security, Railroad Retirement, and all the rest of the things govt is paying for, will get the 25% reduction. Watch for low-flying pigs if that happens (it ain't a-gonna).
What WILL they do?
We can no longer avoid this debate. It starts hitting the fan TODAY, Monday, May 16, 2011.
Here's a thought: How about getting out that dusty old law written in 1787, plus all its amendments since, and seeing which govt programs are explicitly authorized in it (as required by its 10th amendment)... and start applying the 25% cut to all the ones that aren't? And if that's not enough, a 30% cut... or 35%.... etc.
Sound like a plan? If not, then what do YOU suggest they do if the Debt Ceiling is not raised?
-------------------------------
http://online.wsj.com/article/SB10001424052748703421204576325583050561022.html
As Debt Limit Reached, Agreement Still Far Off
By DAMIAN PALETTA And CAROL E. LEE
May 16, 2011
WSJ's Paul Vigna reports the nation's nearly $14.3 trillion debt ceiling will be breached today. Also, NASDAQ withdrew its bid for the NYSE.
The U.S. government is expected to hit the $14.294 trillion debt ceiling Monday, setting in motion an uncertain, 11-week political scramble to avoid a default.
The Treasury Department plans to announce Monday it will stop issuing and reinvesting government securities in certain government pension plans, part of a series of steps designed to delay a default until Aug. 2.
The Treasury's moves buy time for the White House and congressional leaders to reach a deficit-reduction agreement that could clear the way for enough lawmakers to vote to raise the amount of money Congress allows the nation to borrow.
Gene Sperling, director of the National Economic Council, said reaching the debt ceiling "should be a warning bell to the political system that it's time to get serious about preserving our full faith and credit." The Obama administration says a default would tip the U.S. back into a financial crisis.
