Galt's Gulch
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Lew to Congress: US hits debt limit on March 16, needs to be raised ASAP

Posted by $ Your_Name_Goes_Here 9 years, 8 months ago to Economics
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If we ran our households like the Federal Government, we'd have some REAL issues...
SOURCE URL: http://www.cnbc.com/id/102459024

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    Posted by SaltyDog 9 years, 8 months ago
    Apparently, the word "Limit" has some other meaning in the halls of government. For some reason, to them it means an occasion to blame everyone else for the problems that they themselves created, and the only solution available at the last minute is to create more problems by spending even more money that we don't have. And then they can all pat themselves on the back for 'narrowly averting a crisis'.

    Do I understand this correctly or do I owe them an apology?
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    • Posted by TeresaW 9 years, 8 months ago
      No Salty, no apology owed.That's exactly how it will go. I wonder if they will even bother with that charade. It has worn so thin, especially right on the heels of the HS 'crisis'.
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    • Posted by MinorLiberator 9 years, 8 months ago
      No, you pretty much have it down, no apology necessary. One thing that may be unique to the U.S., although there could be other countries, is the idea of a limit at all. I would guess that in the long history of inflationism as a policy (and let's face it, that's what this is. As far as I'm concerned QE and QE2 are still nice ocean liners) has rarely had a vocal minority. At least we have that, and therefore a pretense of a limit. Small consolation right now, I know, but to the poster who asked if our kids and grandkids would understand what was done to them, they can look at our ideas and know there was opposition, and why.
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  • Posted by SaltyDog 9 years, 8 months ago
    Milton Friedman once famously observed that, "If you put the Federal Government in charge of the Sahara Desert in five years there'd be a shortage of sand."

    Like most good jokes, it's not really a joke at all.
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  • Posted by wiggys 9 years, 8 months ago
    i don't understand why there is a debate, the debt limit is not a limit. the debt is the debt and it will just keep getting bigger as it will NEVER EVER be paid down.
    say what you want but remember when you are 100 years old you will still hear that we have to raise the debt limit.
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    • Posted by $ jdg 9 years, 8 months ago
      The debt can only be as large as it is now because interest rates are near zero. Let the economy get going again, even enough to put money market rates at 3 or 4%, and suddenly the feds will be faced with paying hundreds of billions in annual interest. There's no way they can raise it -- we're well above the hump in the Laffer curve already. That leaves either the printing press, or repudiation of the debt. In either case we are then a banana republic.

      So there IS a limit, even if the only ratings company that tried to call them on it got punished for doing so.
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      • Posted by wiggys 9 years, 8 months ago
        the laffer curve in spelled incorrectly it should be laugher. I would like to own the company in conn that supplies the paper to them.
        what makes you think or believe that anyone we employ such as the pres cares how big the nations debt grows too. trust me there is no end.
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        • Posted by $ jdg 9 years, 8 months ago
          There may be no end to politicians' willingness to borrow, but both the willingness and the ability of anyone to lend them the money will eventually run out.
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          • Posted by MinorLiberator 9 years, 8 months ago
            I fully agree. Not within my lifetime, but not that long before, the British Pound was the "world currency". Now it's the "almighty dollar", and that will also end, sooner rather than later. Sound economics tells us that it will happen, but not when. Strictly on topic, I also fully agree that the "debt ceiling" is a semantic gimmick. If you keep raising a limit, then as others have said, it's not really a limit, is it? The only question is the amount of phony bluster we'll have to endure before the limit is raised, but it WILL be raised.
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  • Posted by $ MichaelAarethun 9 years, 8 months ago
    Ahh yes the; cycle of repression starts again. the USA has no debt limit. Bunk and. Hoakum. Just like the myth of the balanced budget with a surplus, Neither do they shut down the government. So now we start the cycle again in financial terms it's unlimited borrowing with no intention of repaying, massive overspending, with printing press money, inflation, deflation and debt repudiation. Used to be the mantra stated not to worry that won't come true until ten or so generations down the line. Now it's Grandpa and Grandma having to seek work at Walmart to make ends meet. But if you can fool just enough of the people just enough of the time then you too qualify to be a congressional.
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  • Posted by CircuitGuy 9 years, 8 months ago
    "Failing to increase the debt limit would have catastrophic economic consequences." http://www.treasury.gov/initiatives/Page...
    [Sarcasm]We'd better do it then.[/Sarcasm]

    I wish a coalition of lawmakers would insist on keeping the limit where it is, perpahaps indexed to CPI, and then stick to it. We could do cuts or tax increases, but they would not allow us to exceed the limit. There's something terribly wrong when we feel like stopping going deeper into debt would cause a crisis.
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    • Posted by sumitch 9 years, 8 months ago
      We could start with cutting Obama phones. Then eliminate food stamps and go back to the old commodities where you get a sack of beans, some cheese, some flower, some pasta and a few other such. But no dog food, no beer, no steaks, no candy.
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