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“The United States, to put it more clearly, is one of the few countries in the world that is technically incapable of defaulting on its public debts, so we cannot have a situation like in Greece or Portugal or Ireland, ” Rivkin, co-chairman of the Center for Law and Counterterrorism, said during a telephone conference call sponsored by the conservative legal group on July 7. Section Four of the 14th Amendment to the Constitution of the United States says that “[t]he validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned.”
Under the 14th amendment and applicable case law, the government is not allowed to default on the public debt, according to Rivkin. “It means the following: that the default on public debt which, indeed, if it would occur, would be quite horrific, is a misnomer. It cannot happen, it will not happen, even if no debt increase of any kind takes place,” he said. Commenting on the amendment, Rivkin explained: “(The) language of the14thh amendment is pretty clear. It applies only to the true public debt of the United States. It does not apply to the wide range of common litigations, and that point ought to be emphasized because I think there has been quite a bit of confusion about it.”
In realistic fiscal terms, there is no need for the government to default on the debt--by failing to pay the interest it owes on that debt--because onging federal tax revenues far out-strip ongoing interest payments. So far this fiscal year (through July 11), for example, the federal government has brought in $1.647687 trillion in tax revenue, while needing to pay out $150.837 billion in interest on the debt. Tax revenues this fiscal year, in other words, have outstripped the required interest payments by more than 10-to-1.
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“This is a misnomer that I believe that the president and the treasury secretary have been trying to pass off on the American people, and it’s this: That if Congress fails to raise the debt ceiling by $2.5 trillion, that somehow the United States will go into default and we will lose the full faith and credit of the United States. That is simply not true,” Bachmann said at a news conference to introduce the PROMISES Act--a piece of legislation that would set spending priorities if Congress does not vote for a hike in the debt ceiling. PROMISES stands for “Payment Reliability for Our Obligations to Military and Investors to Secure Essential Stability.”
The bill sets payments to the armed services as the first priority in case the debt ceiling is reached, and servicing the interest on the national debt as the second. Specifically, in the case the Congress does not increase the debt ceiling, the bill makes “pay and allowances (without interruption) to members of the Army, Navy, Air Force, Marine Corps, and Coast Guard, including reserve components thereof, who perform active service.” It also allocates revenues for the Treasury Secretary to pay down national debt interest.
Gohmert, a former judge in Texas, stopped short of saying the president was lying about the impact of not increasing the debt limit. “We know from the House rules that the president never lies, but he is taking advice and information from somebody apparently who is willing to lie, because it’s just not true,” Gohmert said. “The fear mongering needs to stop.” King said the PROMISES Act deliberately conjoins the national debt issue with payment to military families.
“It’s my belief that if we put these two issues together, and we get them to the president’s desk for a signature,” King said, “and I can’t imagine what his argument would be against paying our military and keeping our credit rating up. But if we do that, and that turns into law, then its easier for us to sit down and negotiate what we might do, without the threat of no military pay, without the threat of watching our credit go down.” The act supplements the Full Faith and Credit Act, sponsored by Rep. Tom McClintock (R-Calif.), which requires that all “debt held by the public shall take priority over all other obligations incurred by the Government of the United States.”
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So the govt will continue to pay interest, but what will it not pay?
Q: How much revenue does the Treasury take in on average in a month?
A: Roughly about $200 billion.
The U.S. Treasury will not default - Fundmastery Blog - MarketWatch
How is it then that federal government can not live within it means?!?!?!?!
.
How are you going to get arms and munitions, food and clothing for the military. How are the electric bills and fuel bills for the military bases going to be paid?
So the govt will continue to pay interest, but what will it not pay?
The United States cannot constitutionally default on its existing public debt even if the debt ceiling is not raised, constitutional scholar and attorney David Rivkin said during a Federalist Society news event.]
I've been shouting this for 2 days. Obama clearly lied. We have more than enough money for the necessities. I believe after entitlements and soldiers we have about 36 billion left.
It's time to make hard choices not tax increases.
The left just can't let go of the credit card. After all we all like spending a million dollars to see the effects of shrimp on treadmills.
Q: How much revenue does the Treasury take in on average in a month?
A: Roughly about $200 billion.
The U.S. Treasury will not default - Fundmastery Blog - MarketWatch
How is it then that federal government can not live within it means?!?!?!?!
.
So the govt will continue to pay interest, but what will it not pay?
Considering that they WASTE billions of dollars on non-sense--hopefully they'll start taking a hammer at that.
If you think that paying only the armed services salaries and the interest on debt means that the government is not defaulting, your crazy.
How are you going to get arms and munitions, food and clothing for the military. How are the electric bills and fuel bills for the military bases going to be paid?
Not to mention social security and medicare payments.
How about government workers pensions?
The list is endless, but the simple fact is: the governement owes money and the governement has to pay it's bills...all of them.
Here is the budget.
http://www.gpoaccess.gov/usbudget/fy12/pdf/BUDGET-2012-BUD.pdf
p171 for summary overview.
Total social security $761 billion, $63 billion a month.
Total Medicare and Medicaid $764 billion, $64 billion a month.
Security $881 billion, $73 billion a month
Interest $240 billion, $20 billion a month
Total spending $2,646 billion, $220.5 billion a month.
Everything else $1,083 billion, $90 billion a month.
Total receipts
2012 - $2,627 billion, $219 billion a month.
Therefore, we can fund SS, Medicare and Medicaid, defense and interest, assuming we can generate that much in tax receipts. But can we?
Tax receipts
2011 - $2,174 billion
2010 - $2,163 billion
IOW, we are expecting a $450 billion increase in tax revenues over the past two years, including $200 billion more in income taxes and $130 billion more in corporate taxes. Why?
2012 economic growth projection +3.6%. (p202) That is 1% more than this year. Anyone forecasting strengthening economic growth?
If we have the same economic growth as we have had, we will likely have ~$2.2 trillion in revenues, just like this year. That means we will be $400 billion short to pay for SS, Medicare and Medicaid, defense and interest, let alone everything else.
Of course, this will get done by August, so these numbers don't matter much. However, it is difficult to make the numbers work if it continues in the Fall.
Some tough Choices would have to be made for sure. However that does not excuse the Down Right Lying scum bag in the WH. Claiming were going to Default. All we have to do to not Default is pay the interest on time. Which we have more than enough money to do with out Raising the Debt Limit, or Borrowing anymore money.
Period.
So he is a fear mongering liar, Who is playing politics with the worlds economy by floating the ludicrous idea that we could default if we do not raise the Debt Limit.
Why are you libs still defending this asshole. As we speak he is trying to convince us all that the interest alone on our debt is so High, He can not continue to pay it unless we borrow money to do it.
Think about a that for a min.
Sheer Horse Shit.
You must spread some Reputation around before giving it to Toro again.
If you think that paying only the armed services salaries and the interest on debt means that the government is not defaulting, your crazy.
