4 ms·

Unfortunately for the president, he is the one who has the final move if the debt ceiling isn't raised: he will either have to shut down non-essential governmen

Unfortunately for the president, he is the one who has the final move if the debt ceiling isn't raised: he will either have to shut down non-essential government services and skip making some entitlement payments, or he will have to skip an interest/principal payment on the sovereign debt. This puts him in a weakened position relative to the Republicans (many of whom would probably consider skipped entitlement payments as more of a feature than a bug), which probably explains why they are pushing it down to the wire. In addition, the Democrats clearly wish to avoid having another debt ceiling showdown next year during the presidential election, which further weakens their position. It appears that the Republicans are angling for a short-term benefit of spending cuts with a minimal amount of revenue increases in addition to a medium-term benefit of getting to play this game again next year when they have an even larger advantage, so they are presenting this unpalatable option along with the even more unpleasant option of major spending cuts with no revenue increases over a longer period. Attempting to view this from the position of a neutral observer, it actually appears very well played on their part.

jpadkins 15y ago
Congress already passed a bill instructing the Treasury to pay interest on debt, social security, wages of troops in that order. If the President does not follow that law, it's probably an impeachable offense. The result won't be a default or social security checks not getting sent out, but a normal 1994-style government shutdown.
- bd_at_rivenhill 15y ago
  I know that such a bill was proposed, but was it ever passed? I agree that a shutdown similar to the one that happened in '95-'96 (http://en.wikipedia.org/wiki/United_States_federal_government_shutdown_of_1995_and_1996 http://en.wikipedia.org/wiki/United_States_federal_governmen...) will definitely occur if the ceiling is not raised immediately, but Republicans could conceivably double down their bets and refuse to raise the ceiling until entitlements are affected, which would certainly happen before the president made a decision to curtail current military activities. Does anybody have a reference to the rate at which outflows currently exceed tax revenues to give us an idea of when that point might be reached?

jpadkins 15y ago

Congress already passed a bill instructing the Treasury to pay interest on debt, social security, wages of troops in that order. If the President does not follow that law, it's probably an impeachable offense. The result won't be a default or social security checks not getting sent out, but a normal 1994-style government shutdown.

bd_at_rivenhill 15y ago
I know that such a bill was proposed, but was it ever passed? I agree that a shutdown similar to the one that happened in '95-'96 (http://en.wikipedia.org/wiki/United_States_federal_government_shutdown_of_1995_and_1996 http://en.wikipedia.org/wiki/United_States_federal_governmen...) will definitely occur if the ceiling is not raised immediately, but Republicans could conceivably double down their bets and refuse to raise the ceiling until entitlements are affected, which would certainly happen before the president made a decision to curtail current military activities. Does anybody have a reference to the rate at which outflows currently exceed tax revenues to give us an idea of when that point might be reached?