Real 'debt ceiling' coming soon!

[SniperFire]

Oh, not the debt limit the politicians will kick down the road again in the next month.

I am talking about the real one which will change America forever. :


'Of course, the real “debt ceiling” is not a legislative construct – it’s the day when it becomes impossible to print and borrow enough money to sustain those trillion-dollar deficits.

It’s coming soon, and its arrival will be heralded by a massive increase in debt financing costs, which might very well devour half of our current discretionary federal spending overnight. On the other side of that lies the real “fiscal cliff.” You won’t believe how far down it goes.'

Hello debt ceiling, my old friend | Conservative News, Views & Books

 

[TNHarley]

After this debacle is over the next one is just down the road.4 more years of this? It's unsustainable.Can't keep this farce going much longer.Obama is sitting on a three legged stool with two broken legs.

 

[TNHarley]

Liberals wanted this, Liberals got this as their preferred means of
Governance. NOW no more Excuses, Denials, Blaming Others!

 

[ba1614]

Just give obummer control of the credit card limit and all will be well. lol

 

[waltky]

Debt ceiling next fiscal crisis...

What Congress got done, and what it didn't
January 2, 2013 - While you were celebrating the start of the new year, Congress was still trying to clean up matters from the end of 2012. Here’s a quick look at what got passed, what didn’t, and what it means for troops and veterans in the months ahead.

What got passed

** A partial fiscal cliff deal: It took until New Year’s Day, but Congress managed to reach an agreement on extending most of the expiring tax breaks and delaying sequestration spending cuts. Without the deal, deep military spending cuts would have been mandated starting this week.
** The annual defense authorization act: The $633 billion budget bill, approved by both chambers before Christmas, sets spending priorities for the current fiscal year and finalizes a 1.7 percent pay raise for servicemembers starting this week.
** Veterans legislation: Amid the other chaos, Congress found time to finalize a measure authorizing new education counseling for troops and veterans, and another that would create a registry of illnesses related to burn pits to track long-term health issues.

What didn’t get passed

** A solution to sequestration: The fiscal cliff deal only delays billions in mandated defense spending reductions until late March. Lawmakers will resume fighting over how best to pay for those cuts – or avoid them entirely – when the new legislative session begins.
** A new debt ceiling deal: Even before the new sequestration deadline hits, the federal government will have to deal with a debt limit extension. Treasury officials estimate that special spending measures to deal with that ceiling will be exhausted in early February. Last time Congress fought over this issue, lawmakers threatened to shut down all government operations, including non-war military activities.
** A new federal budget: The White House’s plans for the fiscal 2014 budget are expected in early February, but Congress never finalized its plans for the current year (even though fiscal 2013 started in October). The continuing resolution funding government operations expires March 27.

The legislative action means that troops, veterans and their families shouldn’t see any disruption to government programs and services this month. But next month could be a different story. Without a long-term budget deal, and with the sequestration still looming, military watchers are still in much the same place as they were at the end of 2012: waiting to see what the political infighting means for their livelihoods.

Source

See also:

Cliff averted, it's on to the next fiscal crisis
Jan 3,`13 WASHINGTON (AP) -- Onward to the next fiscal crisis. Actually, several of them, potentially. The New Year's Day deal averting the "fiscal cliff" lays the groundwork for more combustible struggles in Washington over taxes, spending and debt in the next few months.

President Barack Obama's victory on taxes this week was the second, grudging round of piecemeal successes in as many years in chipping away at the nation's mountainous deficits. Despite the length and intensity of the debate, the deal to raise the top income tax rate on families earning over $450,000 a year - about 1 percent of households - and including only $12 billion in spending cuts turned out to be a relatively easy vote for many. This was particularly so because the alternative was to raise taxes on everyone.

But in banking $620 billion in higher taxes over the coming decade from wealthier earners, Obama and his Republican rivals have barely touched deficits still expected to be in the $650 billion range by the end of his second term. And those back-of-the-envelope calculations assume policymakers can find more than $1 trillion over 10 years to replace automatic across-the-board spending cuts known as a sequester. "They didn't do any of the tough stuff," said Erskine Bowles, chairman of Obama's 2010 deficit commission. "We've taken two steps now, but those two steps combined aren't enough to put our fiscal house in order." In 2011, the government adopted tighter caps on day-to-day operating budgets of the Pentagon and other cabinet agencies to save $1.1 trillion over 10 years.

The measure passed Tuesday and signed Wednesday by Obama prevents middle-class taxes from going up while raising rates on higher incomes. It also blocks severe across-the-board spending cuts for two months, extends unemployment benefits for the long-term jobless for a year, stops a 27 percent cut in Medicare fees paid to doctors and prevents a possible doubling of milk prices. The alternative was going over the cliff, an economy-punching half-trillion-dollar combination of sweeping tax increases and spending cuts. Despite the deal, the government partially went over the brink anyway with the expiration of a two-year cut in Social Security payroll taxes of two percentage points.

Action inside a dysfunctional Washington now only comes with binding deadlines. So, naturally, this week's hard-fought bargain sets up another crisis in two months, when painful across-the-board spending cuts to the Pentagon and domestic programs are set to kick in and the government runs out of the ability to juggle its $16.4 trillion debt without having to borrow more money. Unless Congress increases or allows Obama to increase that borrowing cap, the government risks a first-ever default on U.S. obligations. Republicans will use this as an opportunity to leverage more spending cuts from Obama, just like they did in the summer of 2011.

MORE

 

[waltky]

Granny says, "Dat's right - dey gonna raise ever'body's taxes...

Dems want to raise as much as $1T through 'tax reform' later this year
1/07/13 - Democrats say they want to raise as much as $1 trillion in new revenues through tax reform later this year to balance Republican demands to slash mandatory spending.

Democratic leaders have had little time to craft a new position for their party since passing a tax deal Tuesday that will raise $620 billion in revenue over the next 10 years. The emerging consensus, however, is that the next installment of deficit reduction should reach $2 trillion and about half of it should come from higher taxes. This sets up tax reform as one of the biggest fights of the 113th Congress, which began on Thursday. Republicans say tax reform should be revenue-neutral. Additional revenues collected by eliminating or curbing tax breaks and deductions should be used to lower rates.

Senate Republican Leader Mitch McConnell (Ky.) has dismissed the possibility of negotiating additional tax increases. “I'm in favor of doing tax reform but I think tax reform ought to be revenue-neutral, as it was back during the Reagan years. "We've resolved this issue. Look, we don't have this problem because we tax too little. We have it because we spend way, way too much,” McConnell said Sunday on NBC’s “Meet the Press.”

Liberal and centrist Democrats say revenues collected through tax reform should go to deficit reduction. “We’ve done about $2 trillion. I thought $4 trillion is the goal we should reach. I think we’re about halfway there. We need another $2 trillion,” said Sen. Ben Cardin (D-Md.), a member of the Finance Committee, which has jurisdiction over tax reform. He said the $917 billion cut under the Budget Control Act passed in the summer of 2011, combined with $620 billion in revenues from Tuesday’s tax deal and interest savings, adds up to about $2 trillion. Cardin said the ratio of spending cuts to higher tax revenues “should be about even” in the next deficit-reduction deal passed by Congress.

Sen. Jon Tester, a centrist Democrat from Montana who won a close reelection in November, set out similar parameters. He said the broad goal for deficit reduction should be in the $4 trillion to $5 trillion range and “we should strive for [a] one-for-one” ratio of spending cuts to additional tax revenues. The White House also supports a 1:1 ratio of spending cuts to tax increases as Congress seeks to finish the fiscal work left unresolved by the recently completed 112th Congress. White House officials point to last week’s fiscal-cliff agreement to “buy down” the sequester for two months. The deal delayed the implementation of automatic across-the-board spending cuts to domestic and defense programs and paid for it with $12 billion in revenues and $12 billion in spending cuts — evenly divided between defense and non-defense spending. Administration officials view that as a template for future deficit-reduction agreements.

Read more: Dems look for up to $1T in new revenues - The Hill

See also:

Tax issue ‘finished,’ focus should turn to spending cuts
1/06/13 - Senate Minority Leader Mitch McConnell (R-Ky.) on Sunday said Republicans will demand steep spending cuts during the next round of budget negotiations.

McConnell, in an interview with ABC’s “This Week,” said President Obama had won all he’s going to get on taxes in last week’s agreement to extend the Bush-era tax rates for most taxpayers. “The tax issue is, finished, over, completed. That’s behind us now. The question is: what are we going to do about the biggest problem confronting us and our future,” McConnell said. McConnell said the next round of negotiations over a deal to raise the debt-ceiling would need to include Democratic concessions on spending.

President Obama in his weekly address Saturday warned Republicans that a protracted fight over the debt-limit could have disastrous effects on the economy and said he wanted the borrowing limit raised and issues on spending and entitlements resolved separately. Republicans, though, believe the debt-limit debate gives them leverage to force Democrats to accept greater cuts and entitlement reform. Some conservatives have suggested allowing the U.S. to hit the debt ceiling if Obama refuses to concede on further budget cuts, but others fear failing to raise the ceiling would likely cripple the U.S. economy.

The Senate GOP leader, though, disclosed little about his negotiating strategy, declining to say whether he’s willing to let the U.S. hit its debt limit without further cuts. “It’s not even necessary to get to that point. Why aren’t we trying to settle the problem?” he said. “We don’t need to use the deadline. We could go through regular order.” McConnell also punted on whether he would back a partial shutdown of the federal government in the spending battle, a threat his leadership colleague Sen. John Cornyn (R-Texas) made last week.

McConnell, though, said he expected lawmakers’ focus to be on spending and that other issues including gun control, will likely see no action for the first few months of the year. “None of these issues are going to have the priority that spending and debt are going to have,” McConnell said. “That’s going to dominate the discussion in Congress for the next two or three months at least.”

Read more: McConnell: Tax issue