On one hand, I would like the first thing Trump does when he gets back into office to be to default and lead America into years of economic downturn.
On the other hand, I don’t want to live through YET another economic downturn.
On the practical side of things, their is enough Democrats and a handful of Republicans in the house and senate that will vote for anything that raises the debt limit to get it passed - the only barrier is scheduling a vote in the house. When democrats only will vote for a democratic speaker and republicans can only loose 3 votes off of a majority and recall with 1 vote, the needed vote to pass the house becomes 436-2.
Going backwards. House rules have been changed and it takes more than one member to bring a motion to Vacate.
Trump is today supporting Johnson so maybe he’ll be reelected speaker.
I don’t know what Democrats will do, but they won’t open the debt limit to unlimit debt as Trump wants.
I wish this stupid farce could just be done away with entirely. It’s just so stupid and just a mechanism for the qons to hold a gun to the head of the American people.
The Debt Limit is placed on the Treasury to allow them to pay for money already spent by the government. Essentially, it limits the amount of debt the Treasury can draw down on. Without it, the bills aren’t paid.
The debt limit was an invention in WW2 to allow the executive branch to change spending priorities for the war without needing to push a new budget through Congress each time. The intent was to give the executive branch more flexibility, within limits, NOT to hold the entire government hostage.
The limit literally prevents US paying its debts, not enforce paying them.
Fact check : True
Without it, the bills aren’t paid.
How does limiting the amount of debts the Treasury can accrue on money already earmarked for spending pay anyone’s bills?
Imagine your spouse hands you a grocery list, you fill up your shopping cart, run it through the cash register, and get a total of $100.
Then you pull out your credit card, only to discover your spouse has also limited how much you can spend to $70.
How are you helped by this system?
How does limiting the amount of debts the Treasury can accrue on money already earmarked for spending pay anyone’s bills?
The simplest answer is to say that the money is earmarked for spending, but not payment. Think that Congress spends the money and Treasury pays for it. Some bills are due and payable this year, a year from now, 5 years from now, etc. Plus, income, or taxes raised, are also veriable.
In any case, the debt limit has to be raised in January and Trump is none too happy about it.
Why even have a debt limit to begin with? It’s a wholely artificial constraint?
You’ve earmarked $100 for spending, you don’t need a send legislative gate on the Treasury to spend it.
That’s a good question. I suppose it has something to do with Congress neededing to pass a budget for each spending bill.
The Debt Ceiling isn’t a budget, its a cap on borrowing. The only thing it constrains is the Treasury’s authority to issue new outstanding treasury notes.
That’s what makes it such a mess. This isn’t Congress retroactively saying “Yes, I told you to buy items 1 thru 10, but if you run out of money drop them in reverse order.” They’re just saying “Hey, if it’s over $70, just don’t buy anything after all.”
There needs to be a budget passed by Congress to allocate money to be spent. It hasn’t been done in some time as Congress can only agree on continuous resolutions. The majority of the budget can’t be changed, things like interest on debt, mandatory programs, etc. That’s why Musk’s BS is simply that.
Next is allocation, or spending. Congress has a pool of money for a division of the government through the budget and now allocates for a particular program or need. It then allocated this money and Treasury is given the responsibility to pay for it. When revenues don’t match expenditure we borrow money from ourselves to take care of the shortfall.
There needs to be a budget passed by Congress to allocate money to be spent. It hasn’t been done in some time as Congress can only agree on continuous resolutions.
CRs simply adopt the budget of the prior Congress, adjusted by some inflation value designated in the CR. They are budgets in every way that matters.
The majority of the budget can’t be changed, things like interest on debt, mandatory programs, etc.
The majority of Congress can’t agree on changes, so they adopt the last consensus in order to continue the operations of the federal bureaucracy. The budget can be changed with a majority vote in two chambers. These chambers refuse to find a consensus on what those changes should be.
Congress has a pool of money for a division of the government through the budget and now allocates for a particular program or need.
Congress has no limit on the amount of dollars it can spend, as the US Government originates its own currency. The only real limit on Congressional spending is the strength of the US dollar on the secondary exchange markets. And right now, the US Dollar is - if anything - too strong for its own good, encouraging an excess of cheap imports at the expense of domestic capital development.
When revenues don’t match expenditure we borrow money from ourselves
We don’t “borrow money from ourselves”. We issue debt that pays an interest rate over time to investors and they lend back cash that they aren’t using. This recirculates the existing stock of cash without inflating the general supply of notes in circulation.
The Debt Ceiling limits how much new debt we can issue, which means driving down the interest rates on existing treasury notes and allowing existing cash stockpiles to languish.
