Raising the debt ceiling

[Huey P. Long III]

Opinions, thoughts, questions, answers... Bring them here.

- Is it a good idea?
- What does it mean for those that live in America, if the debt ceiling is raised?
- What does it mean for the currencies tied to the American dollar?
- How can we the people, help ourselves if no one of deemed authority will help us?
- Is it as bad as the news, blogs, and/or propaganda proclaims it to be?

[Vertigo_One [Ops Mod]]

1. Raising the debt ceiling is the ONLY way to go, since the other option is defaulting on the loans, and basicly America saying to its creditors "we can't pay this back.

2. What it will mean is that the US government can continue to opperate

3. Not much. It will possibly mean that there is more US$ inflation, lowering its value, but mostly it will remain opperating as normal.

4. I'm not sure what that question has to do with anything?

5. It will be very bad if the US defaults.

 

The problem is that the Republicans have moved to a level where they will not tollerate tax rises of any form to deal with the deficit, which is just insane. While you can cut government spending, you also have to raise taxes. That's the very basis of dealing with a deficit. Increase income, decrese outgoings. You can't simply decrease outgoings alone, it won't be enough, unless you decrease outgoings by a fairly absurd ammount. The US realistically has no choice, it must either raise the debt ceiling or accept the fact that its about to loose its international economic superpower status.

 

What's worrying though is that there are plenty of reasons why compromise is not inevitable.

 

http://www.economist.com/node/18958711

[Meg Leach]

It's not just the republicans, no one wants to raise taxes.  Senator Ried's plan also does not include tax hikes as well.  Personally, I think SOME tax increases to the wealthiest americans should be put up because I want us to get away from the ceiling as fast as possible, both plans on the table are free of raising taxes, which leads me to believe that garnering revenue is not seen as important as previously thought (or, they are anticipating hikes from Obama anyway.)

[Vertigo_One [Ops Mod]]

"Most Americans, regardless of political party, don't understand how we can ask a senior citizen to pay more for her Medicare before we ask corporate jet owners and oil companies to give up tax breaks that other companies don't get" Obama.

 

Seems a not unreasonable propostion...

[Meg Leach]

1.  Raising the debt ceiling is the best option for our country.  There are some figures circling around saying that if we do not raise the debt ceiling, we will not default because the IRS brings in enough revenue to pay off our loans (avoiding default.)  These sources were called inaccurate or misguided by CNN, I'm not sure to be honest, I don't think that we are in as dire a risk of defaulting as everyone is saying we are (when I watch the news, I take it with a grain of salt.  I may be jaded, but part of me believes that televised news exists because it is part of entertainment, and we get that through fear-mongering.)  Raising the debt ceiling allows for the US to be able to pay off it's loans responsibly and work it's way out of debt...

 

2. The debt ceiling itself doesn't really affect American citizens, it's the spending cuts that happen as a result of needing to get away from the ceiling.  If anything, the American people can rest a little easier (and forget about the word default)  The debt ceiling being raised isn't anything new, many presidents have and do do it several times during their time in office.

 

3. Again, the actual raising of the ceiling will not do much to the economies and currencies tied to the dollar.  Like I said, raising the debt ceiling has happened several times before, it happens often, the problem with it happening this time is that the left really doesn't like the right, and the right really doesn't like the left.  It's a pissing contest caused by bipartisanism. 

 

4. How exactly would we say help ourselves?  Don't take out any adjustable rate mortgages/buy a car/take out loans.  If the country defaults we could have some interest issues, but that's it.  There's no way for citizens to insulate themselves from the blow because we live in a consumer country, interest rates will be affected if the US defaults, as will everything that involves money (stock market.)  Pay attention to the DOW on August 3?

 

5. No.  Absolutely not.  But, as I prefaced, I think the news is entertainment and fear mongering.

 

 

[Vertigo_One [Ops Mod]]

No.  Absolutely not.  But, as I prefaced, I think the news is entertainment and fear mongering.

 

Erm...how is it not bad? If the US defaults, government employees will not be paid, and the US has basicly admitted it cannot pay back its creditors. So...a very large ammount of money in the world economy simply...stops moving.

[Meg Leach]

I personally don't believe that there is as great of a risk of financial default as the news agencies are saying.  If they problem was truly as dire as people would like me to believe, then everyone would be scrambling, not posturing as they are right now.  If the republican party is as 'greedy'(for lack of a better word) as the liberal media suggests, than they would be killing it to get a deal through (a lot of these people are invested in the stock market.  If default = crash, everyone gets screwed..)  No one wants the US to default, not the republicans, not the democrats, and not the loan holders.  

 

Maybe I'll be eating my words in 5 days, I don't know, because I can't predict the future...But...there are tools at hand.  If all else fails the President can cite the 14th amendment and bypass congress to raise it (it's obscure literature.) Although the President has said he will not, it is an option for him if we get to August 1 and there is no deal.

[Vertigo_One [Ops Mod]]

If they problem was truly as dire as people would like me to believe, then everyone would be scrambling, not posturing as they are right now.

 

That's assuming everyone is rational. The Economist, which is not a publication taken to sensationalism, is one that is deeply concerned about the posibilty of default. There are ways to avoid it, but that route isn't been taken.

 

If the republican party is as 'greedy'(for lack of a better word) as the liberal media suggests, than they would be killing it to get a deal through (a lot of these people are invested in the stock market.  If default = crash, everyone gets screwed..)  No one wants the US to default, not the republicans, not the democrats, and not the loan holders. 

 

No, no one wants the US to default, but the Republicans seem to be believing that the US will default, but it won't be so bad and they can make political capital out of pummeling Obama. Basicly, the current republican strategy is just to oppose EVERYTHING that Obama says, regardless as to wheter or not it is in fact a good idea.