To pay or not to pay
To pay or not to pay
By Roger L. Thompson
On January 19 the United States reached the debt ceiling that was last raised to $31.381 trillion in December of 2021. The debt ceiling is the maximum amount of money that the federal government can borrow to meet its legal obligations. This has been the law since 1917 when the debt ceiling was created by Congress. Prior to 1917, expenditures were authorized by Congress on specific loans or they allowed the treasury to issue certain debt for specific purposes.
Following 1917, the government continued to spend until they reach the debt ceiling limit. According to Wikipedia, the debt limit ceiling has been raised at least 90 times in the 20th century.
Currently, there is no agreement in Congress to raise the debt limit any time in the near future. House Republicans are currently holding out to reduce spending in exchange for raising the debt ceiling. President Biden and the Biden administration have stated raising the debt ceiling is non-negotiable. Meanwhile, Treasury Secretary Yellen is using “extraordinary measures” to prevent a default. She said by using these measures, the US could prevent a default on payments until sometime between July and September.
If an agreement is not reached before then, the US would default on its payments. According to several economist, if the US defaults on payments to bondholders or curtail payments, it could result in a likely global economic meltdown. There could also be possible cuts to Medicare, Medicaid, Social Security and the Military.
Both Republicans and Democrats have voted to raise the debt limit in the past. Both parties have voted for the spending that has led us to reaching the current national debt ceiling limit.
There is no doubt in my mind the elected officials must have a serious conversation about spending and the national debt. The question currently before us is whether we pay our commitments or not? There are some who may agree that now is the perfect time to have this discussion. However, do we put the United States and its good faith and credit at risk?
Another question to be asked is whether or not those involved in the discussion are interested in US citizens and their needs or just an opportunity to appear on national news and create slogans for the next fundraising event or campaign card?
If there is really an interest in lowering federal spending then votes by the elected officials should mirror that conviction. There was a time to stand and vote no on any additional spending and creating more debt. Yet, it is the votes of the elected officials that put the nation at this level of debt.
When Congress has authorized an expenditure, should they pay the bill they agreed to finance? If they agreed to issue a bond, should they not pay the bondholder? Why should the bondholder or the citizens who hold the debt Congress has agreed to pay suffer the consequences of default?
As Congress works the next few weeks to address the debt ceiling limit, may the citizens and the good faith and credit of the nation not be forgotten. Let us as a nation honor our word and pay the debts we have agreed to pay. Then let us take real and meaningful action in the future to stop the spending spree and bring our national debt down.