There more I think about this affair the stranger it becomes.
You have people discussing about raising the debt limit but nobody seems to propose simply getting rid of the debt limit. If people really think that the debt limit crisis is that bad, why don’t they propose to get rid of the concept of the debt limit?
A few ago there was the discussion about coining a 1 trillion dollar coin. Again if the debt limit crisis is that bad, why doesn’t the president coin the coin and get done with it?
If powerful people would really think that this is really bad, I would expect those two things to happen. What we are seeing is that Democracts want to argue that the Republicans are destroying the country.
Some Republican seem to hope to get reduce Obamacare.
The NSA is probably happy that there a crisis that takes the public attention away from them. After all claiming that the Syrian government used chemical weapons only dominated the headlines for a short amount of time and there are still a bunch of unpublished documents.
The press profits from having news that interests their audience. It draws people in to get the latest news.
All those people who want to reign in federal spending have their field day, because the affair “proves” that it’s important to reign in spending and that overspending is a “serious problem”.
I makes it easier to corrupt all sorts of bureaucrats that now find themselves unexpectedly without a paycheck.
I wonder, next time control of the House changes, maybe they will try to do away with the debt ceiling. It’s a fairly recent problem. I think getting rid of the debt ceiling without replacing it with some more effective limit on deficit spending would be dangerous, though. I suspect there would be enough Representatives left in the House who felt the same way that such a bill would not pass.
The president actually talked about the use of legal exploits in a speech he recently gave (he didn’t talk about the trillion dollar coin specifically, but it would fall into the category he was addressing). He basically said that he “had plans” but they would face vigorous legal challenges, and would have almost as negative an impact as an actual default.
I wonder, next time control of the House changes, maybe they will try to do away with the debt ceiling. It’s a fairly recent problem.
No, the same thing happened 17 years ago. There was even a time during the Bush government when Democrats didn’t want to raise the debt limit and used it for political leverage.
This also suggests that everyone in the press follows the playbook of the president and doesn’t get the idea of pushing the coin or a repeal of the debt deiling themselves.
He basically said that he “had plans” but they would face vigorous legal challenges, and would have almost as negative an impact as an actual default.
So basically he said that he’s doing all he can and that the Republicans are still really evil.
I think getting rid of the debt ceiling without replacing it with some more effective limit on deficit spending would be dangerous, though.
If you think that the debt limit is an important concept for limiting deficit spending, why do you think that it should always be increased?
Also, why aren’t congressional budgets the tool of choice?
If you think that the debt limit is an important concept for limiting deficit spending, why do you think that it should always be increased?
Because it’s a redundant constraint. The budget already limits the debt, and that is the best mechanism for limiting it—it can actually take effect safely. The debt limit is a guillotine. If it ever does anything directly, we are screwed.
Because it’s a redundant constraint. The budget already limits the debt, and that is the best mechanism for limiting it—it can actually take effect safely. The debt limit is a guillotine. If it ever does anything directly, we are screwed.
If you think that the debt limit is an important concept for limiting deficit spending, why do you think that it should always be increased?
I never said that. I believe that screwing with it without an appreciation for the complexity of the system one is trying to improve upon can have dire consequences. And the purpose of this discussion is to see how to protect one’s self from these consequences.
The debt limit is actually pretty ineffectual at limiting spending, and now we’ve again been reminded that it can be exploited. But unconditionally making debt-limit increases automatic would sent the wrong message to legislators and investors. I think a balanced budget amendment would be a much better alternative.
There more I think about this affair the stranger it becomes.
You have people discussing about raising the debt limit but nobody seems to propose simply getting rid of the debt limit. If people really think that the debt limit crisis is that bad, why don’t they propose to get rid of the concept of the debt limit?
A few ago there was the discussion about coining a 1 trillion dollar coin. Again if the debt limit crisis is that bad, why doesn’t the president coin the coin and get done with it?
If powerful people would really think that this is really bad, I would expect those two things to happen. What we are seeing is that Democracts want to argue that the Republicans are destroying the country. Some Republican seem to hope to get reduce Obamacare.
The NSA is probably happy that there a crisis that takes the public attention away from them. After all claiming that the Syrian government used chemical weapons only dominated the headlines for a short amount of time and there are still a bunch of unpublished documents.
The press profits from having news that interests their audience. It draws people in to get the latest news.
All those people who want to reign in federal spending have their field day, because the affair “proves” that it’s important to reign in spending and that overspending is a “serious problem”.
I makes it easier to corrupt all sorts of bureaucrats that now find themselves unexpectedly without a paycheck.
I wonder, next time control of the House changes, maybe they will try to do away with the debt ceiling. It’s a fairly recent problem. I think getting rid of the debt ceiling without replacing it with some more effective limit on deficit spending would be dangerous, though. I suspect there would be enough Representatives left in the House who felt the same way that such a bill would not pass.
The president actually talked about the use of legal exploits in a speech he recently gave (he didn’t talk about the trillion dollar coin specifically, but it would fall into the category he was addressing). He basically said that he “had plans” but they would face vigorous legal challenges, and would have almost as negative an impact as an actual default.
No, the same thing happened 17 years ago. There was even a time during the Bush government when Democrats didn’t want to raise the debt limit and used it for political leverage.
This also suggests that everyone in the press follows the playbook of the president and doesn’t get the idea of pushing the coin or a repeal of the debt deiling themselves.
So basically he said that he’s doing all he can and that the Republicans are still really evil.
If you think that the debt limit is an important concept for limiting deficit spending, why do you think that it should always be increased?
Also, why aren’t congressional budgets the tool of choice?
Because it’s a redundant constraint. The budget already limits the debt, and that is the best mechanism for limiting it—it can actually take effect safely. The debt limit is a guillotine. If it ever does anything directly, we are screwed.
It’s not a constraint—it’s a precommitment / beeminder-like device. It’s purpose (at least nowadays) is to make borrowing more politically painful.
Then why shouldn’t we get rid of the guillotine?
A few posts up:
As far as I can tell, no reason at all.
I never said that. I believe that screwing with it without an appreciation for the complexity of the system one is trying to improve upon can have dire consequences. And the purpose of this discussion is to see how to protect one’s self from these consequences.
The debt limit is actually pretty ineffectual at limiting spending, and now we’ve again been reminded that it can be exploited. But unconditionally making debt-limit increases automatic would sent the wrong message to legislators and investors. I think a balanced budget amendment would be a much better alternative.