Do We Really Need A Debt Ceiling?

Submitted by Mike Appleton (Guest Blogger)

The debate raging in Congress over increasing the so-called “debt ceiling” makes for wonderfully frenetic headlines.  It allows Republicans to play pin the blame on the donkey and Democrats to respond with accusations of irresponsible brinkmanship.  In the end it is likely that a bill in some form will be passed because the government must pay its bills.

But lost in the frenzy is a fundamental question.  The budget is determined by Congress through the appropriations process.  Therefore, Congress essentially determines the amount of the nation’s debt.  The borrowing authority granted by Congress to the Treasury provides flexibility in financing that debt.  The executive branch cannot spend more than is appropriated, nor borrow more than is needed to service debt.

So, since Congress controls the purse strings, and the power of the President is limited to implementing the fiscal will of Congress, why is it necessary to periodically debate Treasury’s borrowing authority?  More specifically, is there any logical reason for the imposition of the misnamed “debt ceiling”?

No.

33 thoughts on “Do We Really Need A Debt Ceiling?”

  1. Culheath,

    I used to work in public finance as a municipal securities investigator. Interest paid is generally low. I can just see wall street salivating for the extra payouts… That we pay….didn’t they just screw us 2 years ago. FYI 58 banks are scheduled to be shut down this years…15 have been shuttered so far this year.

    Bob,Esq.

    WWI was was a set up as well…

  2. Judging by the circumstances we presently face, the answer, to me, is no…but I I understand AY’s point.

    I would like to see Obama should go the 14th Amendment route just for the fireworks because I’m really bored of the rest of the idiocy going on.

  3. Based upon the way that creditors loan money and the interest that you pay is related to your over all debt load…the answer is yes…

  4. There’s nothing in Art. I Sec. 8 or the Fourteenth Amendment which suggests the debt ceiling is unlawful. Congress has the power of the purse. If they choose to allow the Treasury Dep’t to borrow money, they can set the terms on that delegation of power. Whether it’s wise or not to have a debt ceiling is, of course, a different question.

    It’s going to cost us between $5.5 trillion and $8 trillion over the next ten years just to pay the interest on our national debt (and that doesn’t count the various “trust funds”). How much debt is too much?

  5. I think the question that needs to be asked is “Does the Constitution permit a debt ceiling in addition to the regular appropriations process?” And the answer, reading the plain language of the first two paragraphs of Article I, Section 8, and Section 4 of the 14th Amendment, seems to be no.

  6. How is piling on more debt the sensible thing to do when were already in a pretty impressive hole?

  7. If Obama has the guts to take unilateral action, his approval ratings would go through the roof. He should go on TV, tell the public that the Republicans have lost their minds and would drive the country over a cliff, and announce that he has directed the Treasury Department to issue enough bonds sufficient to generate income to pay our debts. Those bonds will be valid US debt protected by the 14th Amendment. The Tea Party’s only recourse would be to sue, and they’d get creamed in the court and in public opinion.

  8. Mike A.,

    Absolutely correct. Well done.

    Bob,

    That may be the funniest thing I’ve read all day. 🙂

  9. THANK YOU!

    Fantastic – someone is finally making some sense. If Congress wants a fight, then make it over the budget. But there’s no reason to touch the debt ceiling!

  10. Bob, Esq.:

    LOL. I’ll bet there are still a number of Liberty Bonds collecting dust in attics around the country.

  11. The way it is playing out the real question is how much of our debt to we want to pay for.

    We should always pay our debt, but we should not always go into debt in the first place.

    Like going into debt on senseless endless wars for example.

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