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I recently learnt that Denmark and the US are the only two countries with a fixed debt limit. Several other countries have relative to GDP debt limits. The pu

by Svip 3y ago

I recently learnt that Denmark and the US are the only two countries with a fixed debt limit. Several other countries have relative to GDP debt limits. The purpose is the same; to ensure that executive branch can borrow money without having to ask the legislative branch each time. The US debt limit has existed since 1939 in its current form, but it was only recently (like since the 1980s) that it has become a hot potato. Denmark's has existed since 1993, and only been raised once, though far higher than the actual debt. Other countries don't have these restrictions (fixed or relative), where it's usually because those countries' constitutions allow the executive branch to simply borrow money whenever it sees fit.

bluecalm 3y ago
I think the debt limit is a good idea as it forces some consensus about spendings. Without it people currently in power can spend as much as they please on their electorate needs and leave the next government in a difficult situation. It's worse in countries that don't have separation between executive and legislative branch (most EU countries). For example in my country (Poland) you have a party winning an election and then they control both legislative, executive (parliament chooses the prime minister) and mostly judicial branch (not only attorney general is one of the ministers but because terms for supreme/constitutional courts are short they get to put their guys in as well. If they win two times in a row the majority of justice will be theirs. Once that's done there are 0 check and balances on them. They just spend on social programs and laws benefiting their electorate and screw anyone else. It's a terrible system where winner takes all and is beyond check and balances. Say what you want about US system but at least it's not free for all the way parliament democracy is. The debt limit is one of those checks - wanna spend money? - talk to the other side about it.
- XorNot 3y ago
  What do you think happens when someone refuses to raise the debt ceiling? And who in power in the US both approved the current year spending budget, and is currently threatening to not raise the debt ceiling?
- sschueller 3y ago
  The issue with thr US version of the dept ceiling is that the money was already spent. The discussions to raise it should be before they spend more.
- arlort 3y ago
  > I think the debt limit is a good idea as it forces some consensus about spendings Except it doesn't, as seen in the US doing this dance on the brink every other year. What you actually are thinking of is a spending limit where either constitutionally or by statute you can't pass a budget that isn't balanced to some level. Being able to pass a budget with more spending than revenues and then saying "wait, we have to agree to borrow too" makes no sense > judicial branch (not only attorney general is one of the ministers The attorney general is not strictly considered a part of the judiciary in terms of separations of powers. The role of prosecutor is pretty firmly an executive one based on the model where the legislature makes the laws, the executive enforces them and the judicial checks they're being enforced as written The problem with poland is not as much the system as the fact that they fucked it up by appointing judges illegally. Any system is a free for all if you just break the rules, and parliamentary systems tend to be on average less of a free for all than presidential ones > wanna spend money? - talk to the other side about it That's the point, you already need to talk to the other side in order to spend the money, it's called passing a budget bill. A debt limit just allows you to decouple the debt discussion from the budget discussion, meaning that when it comes up it's either "raise it, we'll see about spending next budget" or "well, guess we're defaulting now"
- the_why_of_y 3y ago
  Essentially a debt ceiling means: * legislature determines the government's income by setting tax rates * legislature determines the government's spending by passing the budget law * legislature determines the maximum amount of government debt by law Obviously if the budget law requires spending that exceeds the tax income, the difference has to be raised by the government by issuing debt. Now the legislature can pass these different laws such that the executive has no choice but to break one of these 3 laws, as it is arithmetically impossible to follow all of them at the same time. I fail to see what the benefit of that would be for anyone. If the legislature wants the government to spend less, they can simply pass a smaller budget.
- hyperpape 3y ago
  > I think the debt limit is a good idea as it forces some consensus about spendings. This is what the budget does. The same legislature that is full of people saying they won’t raise the debt ceiling already passed a budget that implies spending money beyond the current debt ceiling. It passed, with majorities in both houses, and the President signed it. The negotiations were difficult. If we had an ounce of brains, we’d hold the debt ceiling negotiation at the same time as the budget negotiation. I’m not sure if there are congressional rules that prevent this, or if Congress just enjoys the idiocy.
  - makomk 3y ago
    The thing is, it's not the same legislature in the sense that the US has had an election since then and a different party has a majority in the House of Representatives than the one which passed the budget with all the spending. The real question which I think the media is ignoring is why they didn't raise the debt ceiling enough to fund that spending for at least a year or two when they still had power. The cynical answer to that is probably that it was an election tactic: they wanted to convince people to vote for them using the threat that the Republicans wouldn't come to a deal on the debt ceiling and would wreck the government.
    - hyperpape 3y ago
      The first point is somewhat fair regarding whether you can charge the current legislature with hypocrisy. It doesn’t really address the point that they’re gonna pass another budget this year under Republican control—so the debt ceiling is an absurd way to accomplish their goals. The second point I disagree with. The history shows that debt ceiling increases are quite frequent—almost annual. Most of the time it doesn’t provoke a debt crisis. While pre-handling increases with the budget would be better, it doesn’t seem to normally be done. It’s just sometimes the case that one party blocks the process (I think it’s true it’s mostly Republicans, but individual Democrats have opposed raising the ceiling and that’s completely irresponsible). So you don’t need an assumption that Democrats pre-planned this. https://sgp.fas.org/crs/misc/R43389.pdf#page10 https://sgp.fas.org/crs/misc/R43389.pdf#page10
- roywiggins 3y ago
  > Without it people currently in power can spend as much as they please on their electorate needs and leave the next government in a difficult situation. Spending levels are set by Congress, separate to the debt limit. The executive is not authorized to spend money that's not in the budget; there's no blank check. Abolishing the debt limit would not change this at all.
- aldrich 3y ago
  I don't believe its accurate to say that most EU states have no separation between executive and legislative branches. The split is around 50%-50% with a majority of states actually having a bicameral system where these branches are separated, and this practically includes all major economic states of the EU as well as Poland and the EU itself. [1][2] In recent legal material, your country (Poland) is a well-known example of an EU state where the governing party has been systematically breaking down this bicameralism and state of law to accomplish exactly what you're describing though. [1] https://en.wikipedia.org/wiki/National_parliaments_of_the_European_Union https://en.wikipedia.org/wiki/National_parliaments_of_the_Eu... [2] https://data.ipu.org/compare?field=country%3A%3Afield_structure_of_parliament#pie https://data.ipu.org/compare?field=country%3A%3Afield_struct...
  - soco 3y ago
    The OP point was, that no matter how many chambers you have if one party wins majority in all of them and forms also the government (which usually happens), it will decide pretty much all it wants and go forward full steam with the opposition hopelessly running along barking. It's by design. The only chance is with coalitions as there will be more internal friction, but it's a very minor improvement indeed.
rjtavares 3y ago
Most other countries allow the executive branch to simply borrow money, not whenever it sees fit, but when it is required to execute the budget approved by the legislative branch. That is an important distinction.
- deprecative 3y ago
  [flagged]
  - rjtavares 3y ago
    It is, because saying "executive branch can simply borrow money whenever it sees fit" makes it seem like the executive has unlimited power to spend.
    - deprecative 3y ago
      The Executive isn't determining that they need to borrow money. Congress did when they passed a budget and the Executive signed it into law. At that point Congress authorized revenue, borrowing, and expenditures, and other monetary considerations. So, again, there is no merit to the debt ceiling. It exists solely to act as a hostage for conservatives to use to harm the economy and claw back our safety net funding targeting veterans, the elderly, those living in poverty, and other vulnerable demographics.
  - JumpCrisscross 3y ago
    > Constitution explicitly prevents us from defaulting This is far from settled law. What it means for a debt to be “authorised by law” within this context is unresolved and frankly unclear. (The 14th Amendment requires paying debts. Not issuing new debt. Maybe the solution is forced sale of public assets, et cetera.)
  - jakear 3y ago
    In fact, we’ve defaulted many times in the past, but nobody seems to care about that. The treasury secretary indeed lied through her teeth about it, as did the WH press secretary. But of course, the media talking point is to blame Republicans for this “unprecedented calamity”. https://www.axios.com/2023/05/16/us-history-debt-default https://www.axios.com/2023/05/16/us-history-debt-default
kasperni 3y ago
I"m Danish and actually wasn't aware that we have a fixed nominal dept limit. Outside of the EUs 60% debt-to-GDP limit. For people interested in the difference between the US and Denmark with regards to the debt ceiling, take a look at [1]. [1] https://www.cnbc.com/2023/05/24/the-us-isnt-the-only-country-with-a-debt-ceiling-heres-how-denmark-avoids-the-drama.html https://www.cnbc.com/2023/05/24/the-us-isnt-the-only-country...
noodlesUK 3y ago
Parliamentary systems often don’t have these restrictions because failing to pass a budget would be considered losing a confidence vote and the government would be dissolved. It’s different with a U.S. style system with a fixed term congress and presidency that can’t be dissolved.
- kevviiinn 3y ago
  Parliamentary sounds better than this bullshit
  - deleted 3y ago
    [deleted]
  - goalieca 3y ago
    Every confidence vote is 100% along party lines and the executive is the parliamentary leadership. Senior cabinet officials run the country and the prime minister holds all the power.
    - kevviiinn 3y ago
      Sounds better than politicians being controlled by capital from behind the scenes while pandering to citizens and stoking nonsense controversy about things nobody cares about
      - SAI_Peregrinus 3y ago
        Oh, they still do that. Cabinet officials are controlled by capital from behind the scenes while pandering to citizens and stoking nonsense controversy about things nobody cares about.
      - friend_and_foe 3y ago
        That stuff doesnt go away just because you use a parliamentary system. This is really a trait of democratic systems in general.
      - 3y ago

by Svip 3y ago

bluecalm 3y ago

I think the debt limit is a good idea as it forces some consensus about spendings. Without it people currently in power can spend as much as they please on their electorate needs and leave the next government in a difficult situation. It's worse in countries that don't have separation between executive and legislative branch (most EU countries). For example in my country (Poland) you have a party winning an election and then they control both legislative, executive (parliament chooses the prime minister) and mostly judicial branch (not only attorney general is one of the ministers but because terms for supreme/constitutional courts are short they get to put their guys in as well. If they win two times in a row the majority of justice will be theirs. Once that's done there are 0 check and balances on them. They just spend on social programs and laws benefiting their electorate and screw anyone else. It's a terrible system where winner takes all and is beyond check and balances. Say what you want about US system but at least it's not free for all the way parliament democracy is. The debt limit is one of those checks - wanna spend money? - talk to the other side about it.

XorNot 3y ago
What do you think happens when someone refuses to raise the debt ceiling? And who in power in the US both approved the current year spending budget, and is currently threatening to not raise the debt ceiling?
sschueller 3y ago
The issue with thr US version of the dept ceiling is that the money was already spent. The discussions to raise it should be before they spend more.
arlort 3y ago
> I think the debt limit is a good idea as it forces some consensus about spendings Except it doesn't, as seen in the US doing this dance on the brink every other year. What you actually are thinking of is a spending limit where either constitutionally or by statute you can't pass a budget that isn't balanced to some level. Being able to pass a budget with more spending than revenues and then saying "wait, we have to agree to borrow too" makes no sense > judicial branch (not only attorney general is one of the ministers The attorney general is not strictly considered a part of the judiciary in terms of separations of powers. The role of prosecutor is pretty firmly an executive one based on the model where the legislature makes the laws, the executive enforces them and the judicial checks they're being enforced as written The problem with poland is not as much the system as the fact that they fucked it up by appointing judges illegally. Any system is a free for all if you just break the rules, and parliamentary systems tend to be on average less of a free for all than presidential ones > wanna spend money? - talk to the other side about it That's the point, you already need to talk to the other side in order to spend the money, it's called passing a budget bill. A debt limit just allows you to decouple the debt discussion from the budget discussion, meaning that when it comes up it's either "raise it, we'll see about spending next budget" or "well, guess we're defaulting now"
the_why_of_y 3y ago
Essentially a debt ceiling means: * legislature determines the government's income by setting tax rates * legislature determines the government's spending by passing the budget law * legislature determines the maximum amount of government debt by law Obviously if the budget law requires spending that exceeds the tax income, the difference has to be raised by the government by issuing debt. Now the legislature can pass these different laws such that the executive has no choice but to break one of these 3 laws, as it is arithmetically impossible to follow all of them at the same time. I fail to see what the benefit of that would be for anyone. If the legislature wants the government to spend less, they can simply pass a smaller budget.
hyperpape 3y ago
> I think the debt limit is a good idea as it forces some consensus about spendings. This is what the budget does. The same legislature that is full of people saying they won’t raise the debt ceiling already passed a budget that implies spending money beyond the current debt ceiling. It passed, with majorities in both houses, and the President signed it. The negotiations were difficult. If we had an ounce of brains, we’d hold the debt ceiling negotiation at the same time as the budget negotiation. I’m not sure if there are congressional rules that prevent this, or if Congress just enjoys the idiocy.
- makomk 3y ago
  The thing is, it's not the same legislature in the sense that the US has had an election since then and a different party has a majority in the House of Representatives than the one which passed the budget with all the spending. The real question which I think the media is ignoring is why they didn't raise the debt ceiling enough to fund that spending for at least a year or two when they still had power. The cynical answer to that is probably that it was an election tactic: they wanted to convince people to vote for them using the threat that the Republicans wouldn't come to a deal on the debt ceiling and would wreck the government.
  - hyperpape 3y ago
    The first point is somewhat fair regarding whether you can charge the current legislature with hypocrisy. It doesn’t really address the point that they’re gonna pass another budget this year under Republican control—so the debt ceiling is an absurd way to accomplish their goals. The second point I disagree with. The history shows that debt ceiling increases are quite frequent—almost annual. Most of the time it doesn’t provoke a debt crisis. While pre-handling increases with the budget would be better, it doesn’t seem to normally be done. It’s just sometimes the case that one party blocks the process (I think it’s true it’s mostly Republicans, but individual Democrats have opposed raising the ceiling and that’s completely irresponsible). So you don’t need an assumption that Democrats pre-planned this. https://sgp.fas.org/crs/misc/R43389.pdf#page10 https://sgp.fas.org/crs/misc/R43389.pdf#page10
roywiggins 3y ago
> Without it people currently in power can spend as much as they please on their electorate needs and leave the next government in a difficult situation. Spending levels are set by Congress, separate to the debt limit. The executive is not authorized to spend money that's not in the budget; there's no blank check. Abolishing the debt limit would not change this at all.
aldrich 3y ago
I don't believe its accurate to say that most EU states have no separation between executive and legislative branches. The split is around 50%-50% with a majority of states actually having a bicameral system where these branches are separated, and this practically includes all major economic states of the EU as well as Poland and the EU itself. [1][2] In recent legal material, your country (Poland) is a well-known example of an EU state where the governing party has been systematically breaking down this bicameralism and state of law to accomplish exactly what you're describing though. [1] https://en.wikipedia.org/wiki/National_parliaments_of_the_European_Union https://en.wikipedia.org/wiki/National_parliaments_of_the_Eu... [2] https://data.ipu.org/compare?field=country%3A%3Afield_structure_of_parliament#pie https://data.ipu.org/compare?field=country%3A%3Afield_struct...
- soco 3y ago
  The OP point was, that no matter how many chambers you have if one party wins majority in all of them and forms also the government (which usually happens), it will decide pretty much all it wants and go forward full steam with the opposition hopelessly running along barking. It's by design. The only chance is with coalitions as there will be more internal friction, but it's a very minor improvement indeed.

rjtavares 3y ago

Most other countries allow the executive branch to simply borrow money, not whenever it sees fit, but when it is required to execute the budget approved by the legislative branch. That is an important distinction.

deprecative 3y ago
[flagged]
- rjtavares 3y ago
  It is, because saying "executive branch can simply borrow money whenever it sees fit" makes it seem like the executive has unlimited power to spend.
  - deprecative 3y ago
    The Executive isn't determining that they need to borrow money. Congress did when they passed a budget and the Executive signed it into law. At that point Congress authorized revenue, borrowing, and expenditures, and other monetary considerations. So, again, there is no merit to the debt ceiling. It exists solely to act as a hostage for conservatives to use to harm the economy and claw back our safety net funding targeting veterans, the elderly, those living in poverty, and other vulnerable demographics.
- JumpCrisscross 3y ago
  > Constitution explicitly prevents us from defaulting This is far from settled law. What it means for a debt to be “authorised by law” within this context is unresolved and frankly unclear. (The 14th Amendment requires paying debts. Not issuing new debt. Maybe the solution is forced sale of public assets, et cetera.)
- jakear 3y ago
  In fact, we’ve defaulted many times in the past, but nobody seems to care about that. The treasury secretary indeed lied through her teeth about it, as did the WH press secretary. But of course, the media talking point is to blame Republicans for this “unprecedented calamity”. https://www.axios.com/2023/05/16/us-history-debt-default https://www.axios.com/2023/05/16/us-history-debt-default

kasperni 3y ago

I"m Danish and actually wasn't aware that we have a fixed nominal dept limit. Outside of the EUs 60% debt-to-GDP limit. For people interested in the difference between the US and Denmark with regards to the debt ceiling, take a look at [1]. [1] https://www.cnbc.com/2023/05/24/the-us-isnt-the-only-country-with-a-debt-ceiling-heres-how-denmark-avoids-the-drama.html https://www.cnbc.com/2023/05/24/the-us-isnt-the-only-country...

noodlesUK 3y ago

Parliamentary systems often don’t have these restrictions because failing to pass a budget would be considered losing a confidence vote and the government would be dissolved. It’s different with a U.S. style system with a fixed term congress and presidency that can’t be dissolved.

kevviiinn 3y ago
Parliamentary sounds better than this bullshit
- deleted 3y ago
  [deleted]
- goalieca 3y ago
  Every confidence vote is 100% along party lines and the executive is the parliamentary leadership. Senior cabinet officials run the country and the prime minister holds all the power.
  - kevviiinn 3y ago
    Sounds better than politicians being controlled by capital from behind the scenes while pandering to citizens and stoking nonsense controversy about things nobody cares about
    - SAI_Peregrinus 3y ago
      Oh, they still do that. Cabinet officials are controlled by capital from behind the scenes while pandering to citizens and stoking nonsense controversy about things nobody cares about.
    - friend_and_foe 3y ago
      That stuff doesnt go away just because you use a parliamentary system. This is really a trait of democratic systems in general.
    - 3y ago