Germany Says 'Great Uncertainty' About US Debt

Nova78

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Germany Says 'Great Uncertainty' About US Debt

German Finance Minister Wolfgang Schaeuble questioned on Tuesday how the United States could deal with its high levels of government debt after November's presidential election.

But Treasury Secretary Timothy Geithner has said the United States is likely to hit a $16.4 trillion borrowing limit by the end of the year.
Unless politicians agree on a plan, a wave of U.S. spending cuts and tax hikes — dubbed the "fiscal cliff" — are set to take effect in January, within months of the November 6 election.

A burden for generations to come
 
Germany Says 'Great Uncertainty' About US Debt

German Finance Minister Wolfgang Schaeuble questioned on Tuesday how the United States could deal with its high levels of government debt after November's presidential election.

But Treasury Secretary Timothy Geithner has said the United States is likely to hit a $16.4 trillion borrowing limit by the end of the year.
Unless politicians agree on a plan, a wave of U.S. spending cuts and tax hikes — dubbed the "fiscal cliff" — are set to take effect in January, within months of the November 6 election.

A burden for generations to come


I'm lost the debt clock says we're at $20 trillion now and they measure it 4 different ways??

The only solution is to make debt illegal. Of course Democrats oppose since they would be toast if they could not buy votes with promises of more and more debt and welfare entitlements.
 
Granny says, "What dey think it is - some kinda mirage or sumpin'?...
:eusa_eh:
The Debt Limit ‘Is Not Real’
December 11, 2012 ) – House Minority Whip Steny Hoyer (D-Md.) said Tuesday that the debt limit is “not real” and should not be part of any negotiations to avert the fiscal cliff.
“First of all, I again would urge the Speaker not to use the debt limit to the detriment of the credit-worthiness of the United States of America as a leverage point,” Hoyer said during his weekly pen and pad briefing with reporters on Capitol Hill. “It is not a leverage point.” “It is not real,” he said. “It is a phony political debate. We have incurred debt and the United States will meet its obligations, pure and simple.” Republicans have suggested using the debt limit as a tool to lower spending in negotiations to avoid automatic across the board tax increases and spending cuts at the end of the year -- the so-called “fiscal cliff.” “Look, the only way we ever cut spending around here is by using the debate over the debt limit to do it. Now the president wants to remove that spur to cut altogether,” Senate Minority Leader Mitch McConnell said last week.

Speaker of the House John Boehner (R-Ohio) has insisted that any increase in the debt limit must be accompanied by equal cuts in spending. But Hoyer said he had no problem handing over to President Barack Obama the authority the Constitution gives to Congress to borrow money, because the debt limit is “not real.” “If this were real I would agree that the Congress ought not to give up its authority to do that,” he said. “But Congress does ultimately have the authority to do it, obviously; demonstrably it has that authority, but no one believes -- not Mitch McConnell, not John Boehner, not Eric Cantor, ‘cause I’ve talked to all of them -- certainly none of us believe that America’s defaulting on our debt makes sense.”

Both Hoyer and the president are advocating for the so-called “McConnell Rule” to cede Congress’s authority to the executive branch to raise the debt ceiling. President Obama’s initial offer on the fiscal cliff included permanent and unilateral authority to raise the debt limit. During last summer’s debt limit negotiations, Mitch McConnell proposed allowing President Obama to raise the debt limit unless two-thirds of Congress denied the request within 15 days. The president, however, could then veto Congress and still allow the debt limit to be raised. “I think Mitch McConnell made a useful suggestion -- he’s now backed off of it, as I understand,” Hoyer said.

The current debt limit stands at $16.394 trillion, which the Treasury Department expects to reach before the end of the year. As of the close of business Friday, the public debt reached $16.365 trillion, leaving less than $30 billion before the ceiling is met. The Constitution expressly gives the power to borrow money only to Congress – not the president. Article 1, Section 8, Clause 2 says: "Congress shall have power ... To borrow money on the credit of the United States."

Steny Hoyer: The Debt Limit

See also:

White House: Savings Will Be Long Term
December 11, 2012 – The White House asserted that spending cuts would occur under a deal reached with Republicans, but would not pledge to make them immediate, addressing a key concern of many conservatives who fear a compromise will mean tax hikes without spending cuts.
CNSNews.com asked, “A complaint has been made among conservatives that in the past deals were made $3 for spending cuts for every $1 in tax increases, the spending cuts are always 10 years ahead, five years ahead or somewhere along the line. Would the White House agree to something along the lines of upfront cuts early on?” White House Press Secretary Jay Carney responded with two points. “First, when rates rise on the top two percent, a subject much discussed during the campaign, the savings achieved through that will be over 10 years. It’s not collect in the first week or month or even year,” Carney told CNSNews.com. “All of this is a period of over 10 years, both savings from spending cuts and savings from revenue increases. “Two, the president has signed into law specific spending cuts as part of the Budget Control Act. What we have not seen, as I have said already is any specific proposal from Republicans, at least Republican leaders, about how we achieve specific revenue targets that are needed for a balanced approach,” he said.

In 1982, President Ronald Reagan agreed with congressional Democrats on a plan to cut spending by $3 for every $1 in tax hikes. In 1990, President George H.W. Bush made a similar $2 in cuts for every $1 in tax hike deal with congressional Democrats. “Each time, the tax hikes were real and the spending cuts never materialized. But now it seems those supporting this commission may have in fact signed off on a 1-1 ratio of real tax hikes and fake spending cuts,” the Americans for Tax Reform website. House Speaker John Boehner (R-Ohio) criticized President Obama for not offering sufficient spending cuts during a House floor speech on Tuesday. “Let’s be honest - we’re broke,” Boehner said on the House floor Tuesday. “And the plan that we’ve offered is consistent with the president’s call for a ‘balanced approach.’”

Boehner continued that the two sides are not closer to a deal. “A lot of people know that the president and I met on Sunday. It was a nice meeting, it was cordial, but we’re still waiting for the White House to identify what spending cuts the president is willing to make as part of the ‘balanced approach’ that he promised the American people. Carney referenced the fiscal plan that Obama presented to the Super Committee in 2011 for having $240 billion in cuts, listed on pages 17 through 45. However, Boehner and Senate Minority Leader Mitch McConnell (R-Ky.) insisted the cuts were not specific.

Both parties are seeking to avert going over the fiscal cliff, the phrase used to describe the automatic tax hikes and spending cuts that are scheduled to take effect in January. Obama’s plan would increase taxes by $1.6 trillion and calls for the ability to increase the debt ceiling at will, requiring a two-thirds majority of Congress to stop it. Further, Obama has asked for $50 billion in stimulus spending in the first year, but did not identify spending or entitlement cuts. Boehner presented a counter offer to increase taxes by $800 billion through limiting deductions and loopholes.

White House: Savings Will Be Long Term | CNS News
 

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