Raising The Debt Ceiling is a Sign of “Leadership Failure”

by lewwaters

Once again, the 75th time since 1962, we have hit the limit on how much government is permitted to borrow. The argument is we must raise it again to prevent default and so government can pay the bills. What will happen if we do raise it yet again?

Also:

“The fact that we are here today to debate raising America’s debt limit is a sign of leadership failure. It is a sign that the U.S. Government can’t pay its own bills. It is a sign that we now depend on ongoing financial assistance from foreign countries to finance our Government’s reckless fiscal policies.”

“Increasing America’s debt weakens us domestically and internationally. Leadership means that ‘the buck stops here.’ Instead, Washington is shifting the burden of bad choices today onto the backs of our children and grandchildren. America has a debt problem and a failure of leadership. Americans deserve better.”

Senator Barack Obama, March 16, 2006

OMG 2012

15 Comments to “Raising The Debt Ceiling is a Sign of “Leadership Failure””

  1. Be reasonable Lew. It’s only a lack of leadership if the leadership is Republican. Democrats are only doing what comes natural for them – overtaxing and overspending. It really was a failure of leadership during the Bush years – we would not have had to increase the debt limit if he (Bush) would have had the moxie to veto even one spending bill.

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  2. While I agree he should have used his veto pen more, he is hardly to blame for 74 increases since 1962.

    The blame goes to both parties.

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  3. “Debt Ceilings” are an emotional issue, not really a financial one. They used to be important when there was a Gold Standard but with modern Keynesianism they mean almost nothing – except politically. Speaking as an accountant, financial planner, and student of economics, it makes no logical difference what the debt ceiling is or even the amount of deficit spending, but there are irrational fears at play here that make me side with fiscal hawks – as I’ve previously written:
    http://www.martinhash.com/forums/viewtopic.php?f=21&t=544

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  4. Martin, I have to disagree. First, I’m not a fan of Keynesianism.

    Secondly, when debt rises so high it cannot be repaid, what then?

    With a country like China, growing economically every day, what happens when they demand repayment and we haven’t any money to do so?

    Controlled debt is one thing.

    Ever escalating debt with no relief in sight is quite another.

    And, as I said, neither party gets a pass on the debt. Both have been as irresponsible as can be with it for far too long.

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  5. Keynesianism isn’t going away, and there’s nothing wrong with it – in fact, it’s good stuff.

    Here’s the simple scoop: deficit spending puts money in the economy that wouldn’t otherwise be there. EVERYONE benefits from that money and eventually it ends up somewhere. As long as the system is closed (no trade deficits), Americans have that money. But taxes are politicized so the money does NOT GET PAID BACK.

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  6. I’ll tell that to Visa and MasterCard as I keep exceeding my credit limit, Martin.

    I’ll refer them to you when ask for repayment 😉

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  7. Lew, are you equating yourself with a Government?

    One last thing about that deficit money – you can find it in banks. The bigger the account, the more deficit money is in it. That’s why Liberals are always pointing their fingers at “the rich.” Liberals think “the rich” owe their share of the money back contractually, whereas Progressives think “the rich” owe money for Marxist reasons.

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  8. Well Martin, there is that little quote of “government of the people, by the people, for the people” from long ago 😉

    Yes, I know that financially, things are much different between them and I.

    I also know that whether a nation or an individual, out of control spending and spiraling debt is not good.

    All we need do is look towards Greece.

    Try telling them deficit spending doesn’t matter.

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  9. I’m simply pointing out that Keynesianism requires the equation be balanced: Deficit Out = Taxes In

    There’s another important part of the equation: a market economy requires that productivity exceed consumption. Greece got both parts wrong.

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  10. Are we really all that far behind Greece, Martin?

    We produce very little compared to what we once did.

    No production, no consumption either to keep our economy going.

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  11. Here’s where the nuance of my personal politics comes out…

    I believe that individual people should generally be held to the productivity > consumption rule. (Conservatives also believe this but they don’t put it into an equation like I do – they mix it up with the concept of accountability.)

    It wouldn’t take much to make Deficit Out = Taxes In, and even though it’s going to take a monumental event (economic crash, Global Warming, giant California earthquake, biological terrorism, etc.), the ideologues will be overwhelmed and we will balance the equation.

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  12. Martin, it sounding more and more like you’d join others in confiscating the wealth in the country.

    From what I have read, there isn’t that much wealth to confiscate.

    Are we still a free nation if we got to that point?

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  13. “Confisate” is a loaded word, Lew.

    History shows us that wealth needs to be constantly redistributed. Market forces are the most common way, but there is also the political process. If those don’t work there’s revolution, invasion, and catastrophe.

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  14. Feel free to give me that history lesson, Martin.

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  15. Give us your checking account information so we can “re-distribute” your money, Martin.

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