Debt

Good Idea, Wrong Time

The trouble with the debt ceiling debate

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When a reporter recently asked President Barack Obama about the House Republican efforts to pass the Cut, Cap and Balance Act of 2011, Obama explained that politicians "don't need a constitutional amendment to do our jobs. The Constitution already tells us to do our jobs—and to make sure that the government is living within its means and making responsible choices."

Dear God, we're doomed.

Remember that the president's last tangible stab at a "responsible choice" was a budget that would have added $9 trillion of debt over the next 10 years. This was months before he realized the debt ceiling debate and "economic Armageddon" could bring about political opportunity. The White House went on to call the bill, which trades a debt ceiling increase for a constitutional balanced-budget amendment and caps on spending, "extreme, radical and unprecedented."

Considering nearly every state works with similar restrictions, it's not exactly unprecedented. And if it's "extreme, radical and unprecedented" to the administration, it undoubtedly makes plenty of fiscal sense. Certainly, it's easy to understand why an embedded statutory and/or constitutional limit on spending is enticing to many voters. But can we force fiscal restraint on those who don't want it?

Remember pay-as-you-go legislation? Passed to offset the cost of increased spending and reduced revenues, it exists in name only to both parties. The so-called "debt ceiling" is a similar abstraction. It reminds me of my biyearly "weight ceiling" pledge—as in, there is none. Any ceiling that is always raised and then set as some new arbitrary level that is negotiated solely by the ones who are borrowing … well, that doesn't comport to any definition of "limit." That's a federal budget.

The rating agency Moody's recently suggested that the debt ceiling be done away with completely, not because it's an artificial cap, but because it creates "periodic uncertainty" about our ability to meet our obligations. Notice that the ceiling on enormous debt is what creates "periodic uncertainty," not the debt itself. Surely, corporations should feel comparably unrestrained to borrow without limits—you know, to create confidence among investors.

The Washington Post offered similar thoughts on limiting government, explaining that a balanced-budget amendment "would deprive policymakers of the flexibility they need to address national security and economic emergencies." Yes, I believe the paper meant to imply this was a negative consequence. Listen, we don't want to inhibit the creativity of the president, which these days consists of demanding that the rich pay their "fair share"—or what Democrats refer to as "budgeting." (Note to Obama: If we all actually started paying our "fair share," we wouldn't have anything left.)

So you can see that debt ceilings, balanced-budget amendments, and spending caps are all great ideas. Consequently, they have either no chance of passing or, should they pass, no chance of mattering. Every cap is sure to be crashed through, and every constitutional restriction is sure to be circumvented. Emergencies abound, after all, because everything is an emergency, and limiting government is always "devastating" to a host of imaginary victims.

Moreover, Republicans, who, it must be noted, didn't care much about deficits before, have no need to expand this debt ceiling debate into one on a national amendment. They have all the leverage needed to extract some minor but real concession on spending and entitlement reform right now, not tomorrow. They can do it while holding the line on tax hikes. This is not the time to muddy up a perfectly preposterous discussion in order to try to get the unattainable and maybe irrelevant. Even if the goal happens to be laudable.

David Harsanyi is a columnist at The Blaze. Follow him on Twitter @davidharsanyi.

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  1. The Constitution already tells us to do our jobs?and to make sure that the government is living within its means and making responsible choices

    So he’s claiming that every spending bill he’s supported or signed since taking office is unconstitutional?

    1. No. He’s saying that borrowing fifty cents for every dollar you bring in qualifies as living within your means.

      1. I think you meant $1.10

        1. You’re both wrong, but he was closer. Our deficit is around 50% of revenue, but that means we borrow about 1/3 of what we spend. He used the wrong divisor. Our cumulative debt is soon to be 110% of GDP, but that wouldn’t apply to his statement of annual spending.

          1. Uhhhhh, no?

            I said “borrowing fifty cents for every dollar you bring in” which is equivalent to “Our deficit is around 50% of revenue”.

            I accept your apology in advance.

          2. File under: “humorless pedantry?”

            I think you meant, “you’re both right, but I want to make a point too, so…”

    2. Yeth, the Conththitution tellth uth to do our jobth, but who can read it? I don’t even like making the effort to thay “Keynethian”.

  2. Women are not actually attracted to men. There is a vague idea of what a man is physically, and some are better than others aesthetically speaking, but the purely physical appearance of a man is almost inconsequential unless he is horribly ugly or outrageously attractive.
    Women are attracted to status, money, how much a man smiles and laughs, how many friends and resources a man has, how full a man’s life is–how many “cool,” “exciting” and prestigious things he is doing or connected to.
    They are interested in how other people view him–how many people want to be around him, how other people interact with him and whether their interactions convey that he is special and amazing. They want him to be extremely outgoing and aggressive, they want him to demonstrate his status over other people by dominating them in various non-violent ways.
    A woman’s attraction to a man is a function of her jealousy at the thought of another woman having that man. She doesn’t care who he actually is or EXACTLY what he looks like physically, she only cares about the VALUE of the life he has constructed around himself.
    A woman basically is a greedy materialistic prostitute. Although that sounds vulgar, it’s true. She trades her physical self to buy into the success a man has created for himself.

    1. Nomination for best “Wrong Thread” comment.

      1. Replace man with politician… or something like that.

    2. wait, wut?

    3. I seem to recall John not normally being a very-drunken misogynist until at least 5:30PM

      Or is this a different John?

      By the way: I would so pay money to have the above person go on a reality-TV-show dating-thing with Andrea Dworkin.

      Sparks would fly. I hear Strangers In The Night in the background already

    4. Or, an alternative reply:

      (say in bored feminine voice)

      “Yawn…Ok, what you’re saying is, You’re Broke, Unaccomplished, AND Ugly?? I at least hope you’re paying for this drink?

      OR (in any tone of voice you want)

      And the funny part is that Men Are Worse!

    5. John… respectfully, LOL WUT?

    6. I think John just broke up with his significant other.

      Hey man no need to hate on all women…it was only the you use to be dating that was a bitch.

      1. It wasn’t me. The trolls are getting a little smarter. It used to be that they would have me claiming to be gay (NTTAWWT). Now they put this up.

    7. Someone is trolling me btw. I have no idea who or why. But that was not me.

      1. That kind of sucks…it would have been so much better if it was real you.

        Hell if i got spoofed with that whopper i would have claimed the sucker.

        1. I think maybe Rather did it as opposed to my usual fan club. It is just a bizarre post.

          1. I’ve noticed that the trolls have changed strategies of late and instead of going generically after a thread, they go after just one person… your example being a particulary egregious one. Thats some “fire that guy NOW!”-stuff.

            Actually, maybe more like, “so the wife is really on your nerves, huh?”-stuff

            And so the virus mutates and adapts…

            1. Fluffy made a great point the other day. The threaded comments really enable the trolls. It allows them to piss on each individual comment. In one long thread their comments would get lost. We really need to get rid of threaded comments or go to some kind of registration system.

              1. I forget what the reasoned-Reason-explanation was for not wanting to register people… Anonymity, free speech, something something something…? I vaguely recall there actually being a reason.

                Threaded comments, I dunno. maybe for the very reason I’m actually responding to you now. *cause I can*

                FWIW, I think despite the troll-virus evolving, we’re a relatively immune bunch. We out-funk the trolls most of the time. They can’t even hang.

                Although that thing about women was pretty ridiculous…probably because it seemed *sincere*

                1. Screw it. I like the anonymous free for all. I could tell that wasn’t really John. Not too hard.

              2. but then we would never have the glorious “PWNED” thread!

                1. The Derider could still post, it would just be more difficult for he or she to come back the next day under a different handle to peddle the same bullshit. All registration does is give us semi-stable identities.

                  The real problem would be the land rush we’d have to undergo to get our preferred screen names.

              3. “or go to some kind of registration system”

                That is very libertarian of you.

                You know who else had a registration system…

          2. I think maybe Rather did it

            Yeah that is my first guess as well.

    8. A woman basically is a greedy materialistic prostitute.

      But in their defense isn’t that more deep and profound then a man’s love which depends on such superficial thinks as youth and looks?

      Women: I love you because of how smart and diligent you are at making money and gaining influance.

      Men: I love your perky tits

      1. both sides are correct in their assessment of reproductive fitness btw.

        1. In other words, even accepting these simplistic characterizations, neither men nor women are being shallow. They are in fact zeroing in on the most important things.

          1. Excellent points.

    9. This was cut an pasted off the internet.

      http://www.wrongplanet.net/postt48756.html

      1. there is even a youtube video of it:

        http://www.youtube.com/watch?v=eIdUlzG9Mjs

        1. Looks like it originated on a craigslist post from as far back as 2007.

          http://www.craigslist.org/abou…..35602.html

    10. John, that may have been off-topic, but it was a helluva screed and I commend you for posting it.

  3. I am a vampire.

    I had my awakening when I was 17. After a night of hanging out with some friends, I was visited by a vampire. He called himself Triumverus Caer. He came in through my bedroom window and spoke to me about his ability and his council.

    He placed his hands upon my chest and I soon felt very cold. I dropped to my knees and looked up to him. He grabbed me by my neck and sunk his beautiful fangs into it. Oh, the feeling of such power coursing through my veins was almost orgasmic, I passed out from the pleasure.

    When I awoke, there was a small scroll on the floor in front of my body. I sat up slowly, my whole body was dead cold. When i reached out for it and read it. I understood it completely. This is strange because it was written in Latin. It told me about my newfound powers.

    What are my powers you ask? I have the ability to withdraw the energy from your body. A psychic vampire. This kind of vampire is special because I can still go out in the sun and have a normal functioning life. I feed off energy instead of blood.

    So, here I am now, I’ve had my powers for little over 3 years. They’re great. I’m in very high respect of the elders and I’ve become a sire to a few of my own underlings.

    1. wait, wut? (it had to be repeated).

    2. I prefer to suck the life out of economies myself.

    3. http://forum.bodybuilding.com/…..81581.html

      Looks like this one was cut and pasted from the internet like that spoof post above.

      Both appear on the bodybuilding forum

  4. Regarding the proposed Balanced Budget Amendment:

    If the Federal Government does not follow the Constitution as it is now, why should I trust that they would follow a new amendment to it?

    Just how often does the TSA abide by the letter of the 4th Amendment?

  5. there once was a girl from Brighton
    whose boyfriend said “my that’s a tight one”
    she say “you poor soul”
    “you’ve got the wrong hole”
    “but there’s plenty of room in the right one!”

  6. “The rating agency Moody’s recently suggested that the debt ceiling be done away with completely, not because it’s an artificial cap, but because it creates “periodic uncertainty” about our ability to meet our obligations.”

    And just what alleged “obligations” are those?

  7. The rating agency Moody’s recently suggested that the debt ceiling be done away with completely, not because it’s an artificial cap, but because it creates “periodic uncertainty” about our ability to meet our obligations. Notice that the ceiling on enormous debt is what creates “periodic uncertainty,” not the debt itself.

    But of course, David – don’t you see? The restraint is what causes the uncertainty! Which is why the Fed removed the other natural restraint to debt – the interest rate – forever out of our minds! We’re truly free! FREE!!!!

    1. it’s clear to me now. Obama wants to manage the governments finances the same way ans Fannie May and Freddi mac, no controls just spend till it breaks.

      1. no controls just spend till it breaks

        There’s a certain freedom in being completely broke and not having anyplace to go but up.

  8. there once was a man from Caras
    whose balls were made of fine brass
    in cold windy weather
    those balls banged together
    and sparks would fly out of his ass!

    1. There once was a man from Nantucket.

      Now shut the fuck up.

      1. You’re just jealous that you don’t have brass balls.
        Poor baby.

        1. Re: sarcasmic,

          those balls banged together
          and sparks would fly out of his ass!

          I do not believe brass emits sparks when hit against brass.

          1. Steel doesn’t rhyme with ass.

            1. Re: sarcasmic,

              Steel doesn’t rhyme with ass.

              Good point. But does it ram ass?

              1. It does if it is British.
                .
                .
                .
                Being an old Mexican I will assume you do not listen to heavy metal, so I don’t expect you to connect British Steel to Judas Priest to Rob Halford who was the first openly gay metal god and back to ass ramming.

                1. Re: sarcasmic,
                  You got me there.

                  And… that knowledge you possess creeps me out.

  9. Here’s Peter Schiff’s take on the whole deal from last week:

    http://www.europac.net/commentaries/don‘t_be_fooled_political_posturing

    Pretty good stuff. I think that’s the consensus view at least amongst market-watchers…

    Sorry – I didn’t mean to interrupt the otherwise *really serious commentary* going on…

    1. You accidentally the link.

        1. Fron the link:

          But Republicans want to raise the debt ceiling just as much as Democrats, they just want to gain [a] political advantage in the process. They have widely accepted the Democrat stalking horse that a failure to raise the ceiling will lead directly to economic Armageddon. No party wants to be held responsible for such an outcome. Even if the expected Armageddon does not come, the Republicans will be blamed for any problems that follow a no vote on the increase, regardless of the true cause. As a deal is in everyone’s political interest, I am convinced it will happen.

          1. ” Republicans want to raise the debt ceiling just as much as Democrats,”

            That was never in question.

          2. Republicans want to raise the debt ceiling just as much as Democrats

            Some republicans.

            There are a few that don’t want to raise the debt ceiling at all.

            Are there any democrats who don’t want to raise the debt ceiling?

            I mean democrats now….there were a lot of democrats in 2006 that didn’t want to raise it…in fact all the democrats in the senate in 2006 voted against it including Obama.

            1. A lot of the difference in the voter base.

              Republican voters, especially the most vocal and active ones, don’t want the debt ceiling raised. That’s where the pressure is actually coming from. That, and as Powerline puts it, the Republicans don’t want to end up “holding hands with Democrats as they go over the waterfall” into fiscal catastrophe.

        2. We are fucked

          Today a married couple with a combined income of $250,000 (assuming each spouse earns 125,000) will pay about 40% of their combined incomes in Social Security, Medicare, and federal taxes, if they take the standard deduction. (I have included as part of their incomes and taxes the Social Security and Medicare taxes paid on their behalf by their employers ? which in reality are borne by the employee anyway. I then added that figure to their incomes, and divided the total tax paid by that higher income. I did not factor in this year’s one time 2% payroll tax holiday.)

          Compare that to a household in 1950 that earned $25,000 per year (the approximate equivalent to $250,000 today). Assuming all the income was earned by the husband, which was the norm at the time, the total tax take using the standard deduction and including both the employee and employer social security taxes, would have been just below 22%. In other words, despite claims that taxes are at their lowest levels in 50 years, today’s high earning couple pays over 80% more in federal taxes than their 1950 counterpart!

          It is no surprise that statists love inflation.

  10. The rating agency Moody’s recently suggested that the debt ceiling be done away with completely, not because it’s an artificial cap, but because it creates “periodic uncertainty” about our ability to meet our obligations. Notice that the ceiling on enormous debt is what creates “periodic uncertainty,” not the debt itself. Surely, corporations should feel comparably unrestrained to borrow without limits?you know, to create confidence among investors.

    These are two wholly unrelated issues. Our amount of borrowing is high, but it can easily be repaid if we actually set our mind to it.

    On the other hand, having a chance of voluntarily defaulting every 6-18 months is a problem in and of itself, and there is no reason for it.

    The debt ceiling is a mechanism to prevent us from paying our bills. What we need is a mechanism to prevent us from running up those bills in the first place.

    1. … it can easily be repaid if we actually set our mind to it.

      And what are the odds of that happening?

      … chance of voluntarily defaulting every 6-18 months

      There is no more chance of defaulting with the debt ceiling than there is without it. All else being equal, would someone with a credit card that has no limit be less likely to default than someone with a credit card that *does* have a limit?

      1. And what are the odds of that happening?

        Approximately zero. But S&P doesn’t rate the odds that we’ll pay off the balance, just that we’ll pay on time. And we’re in no danger of being unable to.

        There is no more chance of defaulting with the debt ceiling than there is without it.

        If we don’t extend it, and we run out of gimmicks to pretend we’re under the limit, then we will default. We may pay the bond interest, but will default on other things. This is not in dispute, although some people who don’t understand finance claim that defaulting on things other than T-bills isn’t a default. They are wrong.

        All else being equal, would someone with a credit card that has no limit be less likely to default than someone with a credit card that *does* have a limit?

        You seem to fundamentally not understand what the debt limit is. It is a limit on the ability to pay for things we’ve already bought. It’s like having a checking account with a daily withdrawal limit. If that limit is less than your minimum payment on a credit card plus various bills, you default. Our budget is the actual spending on the credit card. That’s what needs to be limited.

    2. “What we need is a mechanism to prevent us from running up those bills in the first place.”

      We do have one; it’s called Representation. And it works perfectly; irresponsible leaders due to irresponsible voters. For better or for worse, we’ve got what we deserve.

  11. I’ll admit, I’m amazed that the republicans haven’t caved in by now. Maybe a few of them are actually smart enough to realize how close they are to winning this debate.

    Obama’s bluff doesn’t just deserve a mere call; reraise him all-in and the schmuck will be forced to lay down his worthless hand. But I still have the sinking feeling they’ll find a way to cave in and snatch defeat from the jaws of victory at the last minute like they always do.

    1. They’ll still cave. It’s just that it’s taking longer this time.

  12. I’d say I wish Obama got hit by a bus, but then he’d get a state funeral with full honors sooner. Fucking hell no.

    1. You are aware you just sent us an invitation for a visit, I hope?

  13. Considering nearly every state works with similar restrictions

    and

    Every cap is sure to be crashed through, and every constitutional restriction is sure to be circumvented. Emergencies abound, after all, because everything is an emergency, and limiting government is always “devastating” to a host of imaginary victims.

    Soooo…

    States can have constitutional limits to spending that work but constitutional limits to federal spending is impossible….

    I think there is an inconsistency to the above quoted claims.

    1. A constitutional limit to spending may not be adhered to, but it does create a political obstacle. It’s harder to raise spending. It won’t keep pols from trying, but at least they’ll have to be a little more imaginative in their rationales.

  14. The rating agency Moody’s recently suggested that the debt ceiling be done away with completely,

    Proving that the folks at Moody’s are utterly incompetent.

    The Constitution requires that all debt issued by the US be approved by Congress. The debt ceiling itself is actually a shortcut mechanism to get this approval.

    Doing away with the debt ceiling will mean Congress has to get much more hands-on and micro-managey in approving new debt.

    Or, we just amend the Constitution to eliminate the requirement that debt be issued only as approved by Congress. Yeah, that sounds like the road to stability, predictability, and certainty in the bond markets.

    1. Proving that the folks at Moody’s are utterly incompetent.

      Nah.

      Moody’s interest is for the US to issue more debt….the less debt the US obtains the less work there is for Moody’s.

      It can’t be incompetent for Moody’s to advocate for a position that brings in more work.

      Cronyism and corrupt yes, incompetent not so much.

      One can be a competent crook.

    2. The rating agency Moody’s recently suggested that the debt ceiling be done away with completely, not because it’s an artificial cap, but because it creates “periodic uncertainty” about our ability to meet our obligations. Notice that the ceiling on enormous debt is what creates “periodic uncertainty,” not the debt itself. Surely, corporations should feel comparably unrestrained to borrow without limits?you know, to create confidence among investors.

      When Congress spends the money, it should be considered an approval to issue the debt to pay for it. The Treasury can issue reports to Congress about debt issues in the forseeable future so that they can cut spending accordingly if they disapprove of new debt.

      This seems like a much better system than voting to not voluntarily default (or commit accounting fraud to circumvent the process) at random intervals.

  15. Ok, maybe I only find this funny, but here =

    http://finance.yahoo.com/news/…..;=&ccode;=

    “China tells U.S. to get debt under control”

    I mean… come on. You know you’re fucked up when the “Commies” are telling you to quit devastating your fiscal future.

    Maybe its a sign for me to finally rename my kids Chun-Li and Liu Kang and get the hell out of this shithole of a country…

    1. Re: GILMORE,

      Maybe its a sign for me to finally rename my kids Chun-Li and Liu Kang and get the hell out of this shithole of a country…

      I’ve always been partial to the name Lin-Lin…

      … but not for my sons. I want to call my wife that, but she does not find it funny. Go figure.

      1. She objects to your imagining she’s a blond oriental with big tits when you bang her?

        Wow. My wife totally gets off on that.

      2. I assume this is not the Lin-Lin of which you speak.

        He looks smart.

          1. No, that’s Lin Lin, not Lin-lin or LinLin.

            Like this one

      3. I’ve always been partial to the name Lin-Lin…

        So…. wait… you really like Pandas?

    2. The Chinese have a vested interest: about $1 trillion in U.S. Treasury instruments whose future value is greatly in doubt.

  16. Doesnt seem like the dude knows what he is talking about.

    http://www.net-privacy.us.tc

  17. 1. The debt ceiling is useful for forcing the issue in front of the public.
    2. A balanced budget amendment would be a harder to ignore than legislation (though pols are certainly imaginative enough to do so). It would certainly make it more politically costly.

  18. 1. Republicans, hold your ground on cut, cap, and balance. Let the Dems vote it down.
    2. Allen West is right. The geezer card is another version of a race card, and it must be thrown back in the face of the player with enough force to cut skin.
    If a Dem says, “you’re trying to reduce the debt on the backs of the old and the poor”, the response should be:

    “Your insinuation that I harbor animus towards older Americans or any segment of the citizenry is a vicious personal attack, and I take offense to it. If you continue it, you will show yourself to be an incompetent clown, a fraud, and unserious about solving this problem. The debt affects every American livelihood, as does high tax, high spending, and overregulation policies of parasitic Democrats who know nothing about how economies grow. The only way to restore a growing business climate and restart investment is to reduce spending and regulation and stabilize taxes at or below current levels.”

    1. Too wordy. They should say “You’re trying to increase the debt on the backs of the old and the poor, you parasite.”

      1. Well done. Pithyness was never my strong suit. Gotta work on my elevator parasite retorts.

    2. Call the “geezer card” what it is: a threat. Obama: “Give me more money to dole out to my cronies and I’ll keep the checks coming. Otherwise, we’ll stop sending them. And the stupid geezers will blame Republicans. Ha! Ha!.”

      1. Yeah, it’s nothin but gangsta style extortion. “Wouldn’t want your dear old grandma to eat dog food, would ya? Then pony up!”

  19. What’s the point?

    The government, at the behest of Americans, is and will continue to spend itself into collapse.

    Nothing that rational, aware people do can stop that. There is no way that Reason, Stossel, CATO, AEI, Heritage, AFP, the Tea Party Movement or anybody else is going to convince enough people to demand an end to the spending to actually produce an effect.

    Take a look at the GOP’s candidates for the nomination: It’s RINO-city with the exception of a few minor candidates who won’t garner anything more than a protest vote.

    There are two major parties in this country and all that matters politically is passed and signed by members of those two parties. Both of these parties absolutely intend to continue spending like a tsunami-scale wave machine at the amusement park of national destruction. Their greedy, parasitic constituents, from baby boomers to welfare leeches, to labor and corporate special interests giggle with glee as they frolic in the foam.

    It’s the Lord of the Flies. The morons and the thieves are destroying the country. Neither you nor I can stop them. That’s not defeatism – it’s reality.

    Secession is the most viable course of action. Dump the chaff.

  20. Not all constitutional retrictions can be circumvented. A Balanced Budget Veto, for example, is self-executing and would impose an constitutional penalty that Congress could only remove by actually balancing the federal budget. See http://www.cato.org/pub_display.php?pub_id=1346

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