Only one other country in the world has a debt ceiling

Discussion in 'Politics' started by Chris, Jul 29, 2011.

  1. Chris
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    Chris Gold Member

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    I know you have all heard so much about the debt ceiling that you're probably exhausted. But I think it's important to point out a few facts because this matter has been so clouded by rhetoric.

    Did you know that there is only one other country in the world that even has a debt ceiling? That's Denmark, a strange anomaly, and its debt ceiling is deliberately kept very high so that it will never need to be raised.

    Why does no one else have a debt ceiling?

    Because when a legislature votes to authorize spending at a certain level but authorizes tax revenues at a lower level, it is assumed that the government will have to borrow the difference.

    The vote to have higher expenditures than tax revenues is - in effect - a vote to borrow money to cover the difference.

    And in the United States, Congress - including Republicans - voted for a budget in which expenditures exceeded tax revenues.

    The logical consequence of that budget - again, passed by Republicans and Democrats, is that the government has to make up the difference by borrowing.

    To come at it now after the budget has been passed is like getting your Visa bill and calling up the company to say, "Actually we don't want to buy all that stuff we bought."

    That's not how it works. First you pay the bill, then you can change your spending habits.

    Fareed's Take: The damage is already done! – Global Public Square - CNN.com Blogs
     
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  2. saveliberty
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    saveliberty Diamond Member

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    What a laugh!

    A diatribe on why we should just keep spending to oblivion.

    Hack.
     
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  3. iamwhatiseem
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    iamwhatiseem Gold Member

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    When counting all obligations - America is nearly $70 trillion in the hole.
    ...something else that is "worth mentioning"...:cuckoo:
     
  4. CrusaderFrank
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    CrusaderFrank Diamond Member

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    Chris, Social Security is broke.
     
  5. Zoom-boing
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    Zoom-boing Gold Member

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    $50,000 comes into a household; $75,000 goes out of the household.

    Instead of cutting spending to below the $50,000 mark, the household opens two credit cards with a debt limit of $15,000 each and keeps on spending.

    Does that make fiscal sense to you?

    Is that sustainable?

    Regardless of anything else, the underlying problems need to be addressed. What part of that don't you get?
     
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  6. NYcarbineer
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    NYcarbineer Diamond Member

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    It's up to Congress to pay for the obligations it has made in the spending in the laws it has passed.

    Or, Congress needs to change the laws. Default is a breach of Congressional duties.
     
  7. Mad Scientist
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    Mad Scientist Deplorable Gold Supporting Member Supporting Member

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    "But Mom, none of the other kids have a Debt Ceiling. It's so unfair!"
     
  8. Grampa Murked U
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    Grampa Murked U Diamond Member

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    And how many other major countries have gone or are heading into bankruptcy because of having a no limits policy? Doh....
     
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  9. saveliberty
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    saveliberty Diamond Member

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    The dollar is a world currency. I guess if your ready to give that up, we can do away with a debt ceiling.
     
  10. Truthmatters
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    Truthmatters BANNED

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    U.S. Debt Ceiling: Your Cheat Sheet to the Policy History (NYSE:DIA, NYSE:IWM, NYSE:SPY, NASDAQ:QQQ, NYSE:MDY, NYSE:TLT, NYSE:TBT, NYSE:XLF, NYSE:UUP, NYSE:UDN) | Wall St. Cheat Sheet



    the closest the government ever came to default was a last minute deal in 1979. Though the deal was finalized in time, computer malfunctions led to $122 million in Treasury payments being delayed, technically amounting to temporary default and thus permanently increasing interest rates by 0.6%, resulting in $12 billion in additional annual debt payments, costing the government roughly $384 billion to date. We can only imagine the toll a default, even temporary, could take on today’s economy.
     
    Last edited: Jul 29, 2011

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