The debt ceiling debacle taking place right now is the most asinine of all manufactured crisis Congress has put the US through. Congress holds the purse strings, they decided to spend money. But they chose to spend more than the total federal revenue so we are running a deficit. Then Congress starts arguing over whether we should incur the debt, which they themselves already appropriated. If Congress had an issue with the deficit they should have engaged that when deciding to spend the money in the first place not when it comes time to pay the bill.
Then to top it off Congress is playing a game of chicken over the debt ceiling. They are threatening to force the US to default on payments unless spending is cut. But wait a second; Congress decided how much to spend in the first place. So they are threatening to harm the whole country because they are unhappy with their own choices.
Furthermore what would a default result in? It would result in damage to the US credit rating and an increase in borrowing costs. If the US pays higher interest rates for debt then more of the federal budget will go to simply paying interest on our credit which will only increase the national debt. Thus Congress is so concerned about the national debt that they are willing to sacrifice our credit rating and increase the national debt to argue about decreasing the national debt. Talk about shooting yourself in the foot.
Finally a US default could negatively impact the US economy and the world economy. That would in turn reduce federal revenues thereby increasing the national deficit and national debt. Despite all the political talk about trying to improve the economy, lower unemployment and help the middle class they are more than willing to throw us all under the bus for a game of political brinksmanship.
The debt ceiling is by far the most asinine of all manufactured crisis. Congress chooses to spend to much, then Congress decides that they didn’t want to rack up that much debt so they threaten to default on the payments Congress already chose to appropriate. So their solution is to default resulting in higher borrowing rates and depressing the economy which in turn will drop federal revenues and increase the national deficit and debt.
Well I hope if they drive the US over this fiscal cliff that they get some rather large cuts to spending because we will need them to make up for the increased borrowing costs and the hit to the economy.