Before the end of the week, the U.S. House and Senate will more than likely be voting in favor of raising the federal debt ceiling. It was midday on Wednesday that Senate Majority Leader Harry Reid (D-NV) and Minority Leader Mitch McConnell (R-KY) revealed details on a bipartisan agreement for the debt ceiling that had been reached, one which would also put an end to the partial government shutdown. In essence, though, the Senate and House are still acting like the irresponsible stewards they are, asserting that whenever someone is buried in debt, all they need to do is just get a higher credit limit. The entire concept is a deplorable one, both logically and morally. It has long been the fallback excuse for continuing to increase spending, rather than cutting much of anything.
In the agreement expressed Wednesday, Reid and McConnell introduced a plan to keep the government open through January of next year, at the same time lifting the debt ceiling until Feb. 7. A budget committee consisting of members from both chambers would be expected to put together a conference report by Dec. 13. In addition, furloughed federal employees would receive backpay, just as happened with the previous shutdown in 1995. The government, in other words, is eventually going to pay for every single thing that it told us it couldn’t.
But, to be fair, the government honestly can’t afford these things because it will have to rely on borrowing to do so. This is the very nature of a debt allowance increase. Despite the administration’s assurances that debt ceiling increases don’t raise debt directly, they certainly help debt to have some room to grow. There’s not a single instance in history, of course, where that very thing hasn’t happened.
When President Obama said in his most recent weekly address that “it wouldn’t be wise to just kick the debt-ceiling can down the road for a couple months,” his sage advice can only be called irresponsible. If we want to be consistent, the president was offering an example to any average American who can’t pay monthly bills – even with existing credit cards – that it “wouldn’t be wise” for them to delay on getting that new credit card. If we don’t allow ourselves to borrow more, he’s saying, then we’ll have no way of paying off the money we’ve already borrowed. Sure, that’s responsible. So when do we quit borrowing?
The very notion is absurd. Nevertheless, the United States Senate is still advocating that same idea, telling us that whenever we’re in debt, we ought to just get a higher credit limit to get us out of the mess. The only problem? It doesn’t get us out of the mess.
Just the same, when Obama claims that “it would become more expensive for everyone in America to borrow money” in the event of a default, all he can be truthfully saying is that it might be more difficult for debtors to take on more debt. And this is a bad thing? I would think that encouraging people (and government) to live within their means would be healthy and sane, not irresponsible and insane. And yet, Obama and the Congress would have us believe the latter to be true. Forbes contributor Peter Ferrara remarked on this very issue yesterday, writing that “Not raising the debt limit does not mean defaulting on the national debt, any more than not increasing your credit limit means you can’t pay your monthly credit card bill, and must default on that.”
Senator Reid, like the administration, went with the good old irresponsible position, veiled as responsibility: “The compromise we reached would provide our economy with the stability it desperately needs.”
Now, isn’t that commendable? It’s not just that one party is irresponsibly raising a credit limit on their own. Rather, they’re working alongside people of the other party to do it.
But what Reid and his Senate are effectively advancing is the wrongheaded notion that whenever someone is in debt, all they really need to do is get a higher credit limit. Forget about everything else. After all, it’s not as though spending far too much money is the real reason that we keep being thrown back into this same dilemma.
An op-ed by Chris Bacavis