Long post on a Hot Topic:
Raising the nation’s debt ceiling in order to pay our bills vs. default and
disgrace. Two of many stories follow:
First from the NY DAILY NEWS with this
headline:
“Senate tackles legislation to prevent U.S. from defaulting on
debt obligations before December 15 deadline”
Senate Majority
Leader Chuck Schumer (D-NY) struck an optimistic note that the debt ceiling
plan will pass with a nod to Sen. Mitch McConnell (R-KY) saying: “Democrats
have always said that we were willing to shoulder the load at 50 votes to get
this done as long it was not a convoluted or risky process, and Leader
McConnell and I have achieved that. We will avoid default, which would have
been disastrous.”
But conservatives and supporters of Trump are vowing to
derail the bill, which they say enables Democratic big spending with those threats
from:
Conservative Sen. Mike Lee (R-UT) attacked the measure
as: “A Frankenstein bill saying it guts the filibuster.”
Sen. Lindsey Graham (R-SC) predicted it would fail.
Speaker
Nancy Pelosi (D-CA) led in passing the measure with one GOP vote (Rep.
Kinzinger (R-IL), saying: “This is about meeting obligations that the
government has already incurred, largely during the Trump Administration. Only
3% of the current debt has been accrued under President Biden.”
KEY TAKEAWAYS
· Debt is money owed, and the deficit is net money
taken in (if negative).
· Debt is not necessarily an indicator of a weak
economy.
· The U.S. deficit, while by far the largest on
Earth in absolute terms, is in the middle of the pack in relative terms.
Debt: At
the end of 2020, the debt was $26.9 trillion. As of August 2021,
the deficit was $2.7 trillion. The debt is a lifetime running tally, while the
deficit is an amount calculated over a particular period.
The clock is ticking as Senate Republicans face a new fight
over raising the debt ceiling after the House of Representatives approved
legislation that would allow Democrats to lift the borrowing cap with a simple
majority vote and avoid a looming national default.
Congress approved a $480 billion increase in the nation’s
debt limit in October. That’s enough for the Treasury Department to finance the government’s
operations through December 15, that according to Treasury Secretary Janet Yellen. The measure includes a provision to fast-track the debt limit
process into an unrelated but popular Medicare bill that will prevent payment
cuts to doctors and other health care providers.
Sen. Schumer says: “We
will avoid default, which would have been disastrous.”
GOP Minority Leader Sen. Mitch McConnell (R-KY) called the move “good for the country and good for Republicans.”
The measure now goes to the Senate, and if the Medicare bill
becomes law, it will open the process for the Senate to raise the debt ceiling
through subsequent legislation with a Democrats’ only majority vote.
Second story is from the Business Insider
with this headline:
“Trump rips McConnell for not using the debt
ceiling to block Biden's agenda, saying Democrats' social spending bill will destroy
our country, the fabric of the country as we know it”
· McConnell is supporting a debt ceiling reform
that will require GOP support to keep paying the country's bills.
· Trump slammed McConnell for failing to use the
debt ceiling to stall Biden's agenda on the Hugh Hewitt show.
· Trump said the debt ceiling is “psychological”
while “Build Back Better” is not and it will destroy” the country.”
Trump isn't too pleased with GOP Senate Minority Leader
Mitch McConnell (R-KY), especially when it comes to his negotiations with
Democrats to make sure the U.S. can keep paying its bills and avoid a debt
default — known as the debt ceiling.
The House voted to approve a reform to raise the debt ceiling, which would allow the Senate to lift the limit and continue paying the bills with a simple majority instead of the 60-vote threshold needed to break a filibuster.
While McConnell remained adamant earlier
this year that raising the debt ceiling is something Democrats must do on their
own, this time around appears to be different, and the
Republican leader expressed confidence that the reform will get GOP support in
the Senate.
But Trump made clear
he does not support this reform at all on conservative talk show host Hugh Hewitt's show saying:
“So Mitch McConnell has the greatest hand, the greatest, the best, this is such
an easy negotiation to kill the “Build Back Worse” plan of Biden, which is
going to destroy our country permanently. And we have a thing called the debt
ceiling. And this morning, I hear he gave it up. He gave it up for practically
nothing. He could have used the debt ceiling card.”
The criticism of McConnell is not something new for Trump. Last month that McConnell appeared to be ignoring Trump calling him a “Broken Old Crow” after he helped Democrats suspend the ceiling by an additional two months in October.
Since then, McConnell has met with Schumer a number of times
to devise the best strategy to ensure the U.S. can keep paying the bills due and
thus avoid a debt default.
Other Republican lawmakers
appear to be on board with McConnell's plan, as well, that would pave the way
for Senate Democrats to raise the debt ceiling on their own.
GOP Texas Sen. John Cornyn told Politico:
“I'm going to support Democrats raising the debt ceiling without Republican
votes. To have Democrats raise the debt ceiling and be held accountable for
racking up the debt is my goal. And this helps us accomplish it.”
GOP Sen. Mike Lee of Utah further told NBC News the reform
is a terrible idea saying: “Terrible. This is nuking the filibuster.”
The bill now awaits Senate approval, and it's still unclear
if enough Republicans will jump on board.
My 2 Cents: Two
interesting stories on the debate about how to pay the bills due to
ensure that the nation does not default and lose credibility as a country that
does not pay its bills.
So, what do we have here:
A good recent solution or not?
Is Schumer and McConnell
both playing chicken roaring down the debt highway with only one willing to
swear to avoid a crash?
We are about to find out. Keep
in mind that McConnell is a very shrewd bill mover, but so is Schumer, now maybe more so. We are about to find out.
Thanks for stopping by.
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