BACKGROUNDThe debt ceiling was established as a tool to aid the federal government to control spending. However, according the Congressional Research Service, the debt ceiling has been raised 74 times since 1962. (Austin and Levit) Since 2001, the debt ceiling has been raised ten times.
As it is now “customary” to increase the debt ceiling, special attention must be granted to U.S. Treasury reports of the last ten years. The Treasury Direct section of the U.S. Treasury Department has reported that on September 30, 2000, the national debt was $5,674,178,209,886.86 while on September 30, 2010, the national debt was $13,561,623,030,891.79. (Historical Debt Outstanding – Annual 2000 – 2010) Despite federal spending increasing at rates which have almost tripled the national debt in the recent decade, the most recent two reported years of spending are of grave concern. From September 30, 2001 to September 30, 2008, the net debt increase was .5 trillion dollars per year. However, a disproportion increase in federal spending can be directly attributed for the period of time ranging from September 30, 2008 to September 30, 2010. In this period of time, the national debt increased some 3.5 trillion dollars, more than tripling that of the net increases of previous years. While the national spending trend is of grave concern, it is currently accelerating at unprecedented rates. Today’s national debt, according to Treasury Direct is 14,293,242,770,354.82. This indicates that the federal government is now spending beyond its means to sustain itself at a rate of 100 billion dollars per month. Current runaway spending has drawn sharp criticism from federally appointed leaders, elected officials and constituents alike.
Pros and cons
The current debate centers on whether or not to increase the debt ceiling to accommodate the fact that the current administration has already spent over the limit. When it comes to assigning credit to those whom both support and oppose the initiative to increase the debt ceiling, we must consider the value of the act itself and its impact upon the American people as a whole. As with most political issues of today, division lies in Republicans and Democrats. Where the Democrats are correct is in the concept that the damage has already been done and perhaps the responsible thing to do is increase the debt ceiling to authorize payment for accumulated debt beyond that of the current debt ceiling. Unfortunately, this is about all we can attribute positive credit with the understanding that some Democrats do not support the spending habits of the last few years. Profound criticism can be applied the Democrat due to the egregious fiscal strategies.
While in this case, Republicans can be credited for better understanding the damage being caused by federal spending, only a few have actually accurately defined the problem with debt ceiling as an ideological concept. However, if their accomplishments in the Federal Budget are any indication of performance in the debt ceiling debate, the debt ceiling will be increased due to their collective bargaining and failure to realize economic radicalization is needed to offset the fiscal damage that now imperils federal government. Any attempt to increase debt is detrimental.
To increase the debt ceiling clearly states that the Democrats have a continued blank check. To not increase the debt ceiling forces the federal government to fund debt with tax revenues. This in turn will force reduced spending which defies current Democrat policy. However, it is not enough to maintain the current, or even decrease the debt ceiling alone.
Without the debt ceiling being tied directly to the federal budget, it cannot control spending. The debt ceiling debate is thus a ritualistic process that yields no positive results. In bridging the debt ceiling and the federal budget, a check and balance is created. The arguments of “catastrophe” are based solely in political rhetoric in order to garner support. (De Haven) Such rhetoric has torn the political fabric of this nation apart requiring upstanding politicians to insist upon themselves while following their ethics, values and principles in order to foster the hope of prosperity in their constituents. Thus, it is my strong recommendation to not only maintain the current debt ceiling, but to introduce legislation to utilize the debt ceiling as a finite cap to both the federal budget and federal spending in general.
Our great nation has been embroiled in budget debate for far too long. Our elected officials have failed the American people and through the current administration’s inept fiscal discipline, only 31% of Americans have confidence in our nation’s future. (RasmussenReports.com) A nation of voters has watched as our elected officials have spent forth coming generation into their debt. The time to stop this is now. We have followed the Obama Administration’s notion that we would “spend our way out of debt.” Since this premise, the budget debate has never been the same. We, as a nation have spiraled deeper and deeper into federal, economic despair.
The White House now wishes to have the debt ceiling increased to accommodate their fiscal policy that has already spent over the current debt ceiling. (Gudmunson) In supporting an increase we enable the poor fiscal behavior being demonstrated by the federal government. Federal spending now grossly exceeds federal revenue which requires government to expand by incurring debt at unsustainable rates.
Federal debt has been on the increase for tens of years with a debt ceiling program in place. A debt ceiling is inconsequential if it is not bound to the federal budget in a manner that provides a true cap on spending. The nation needs trillions of dollars in spending cut to become a sustainable nation; not tens of billions as demonstrated by the current federal budget agreement. To attain this, fiscal discipline must be forced upon the federal government.
Short of coupling the federal budget and debt ceiling, American will never return to a solvent nation.
25 04 2011. RasmussenReports.com. 25 04 2011 <http://www.rasmussenreports.com/public_content/politics/mood_of_america/america_s_best_days>.
Austin, D. Andrew and Mindy R Levit. The Debt Limit, History and Recent Increases. Fiscal. Washington, D.C.: Congressional Research Service, 2011.
De Haven, Tad. “The Debt Ceiling Game.” 27 02 2011. CatoInstitute.org. 25 04 2011 <http://www.cato.org/pub_display.php?pub_id=12804>.
Gudmunson, Erika. “Treasury Notes: Secretary Geithner Sends Debt Limit Letter to Congress.” 06 01 2011. Treasury.gov. 2011 25 04 <http://www.treasury.gov/connect/blog/Pages/letter.aspx>.
“Historical Debt Outstanding – Annual 2000 – 2010.” n.d. TreasuryDirect.com. 25 04 2011 <http://www.treasurydirect.gov/govt/reports/pd/histdebt/histdebt_histo5.htm>.