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Edited by Mrph1 on Nov 30th 2023 at 11:03:59 AM
I didn't see this linked, so I would like to just throw it out for the amusement factor: Mitch McConnell filibusters his own bill to lift the debt limit.
Yes, that's not a misprint. Apparently McConnell had a bill floating around that would give the president authority to unilaterally raise the debt ceiling unless the Senate voted 60-40 or more against it. McConnell thought that Democrats wouldn't support it so he put it up for a vote as a token. Reid and company promptly jumped on it and said, "Hell yes", at which point McConnell filibustered it. The irony impresses me.
I saw this article as a link in the comments of Krugman's latest
, in which he notes Bobby Jindal as yet another Very Serious Person who isn't doing the slightest bit of genuine research on the fiscal cliff.
So Mc Connell proposed it and Reid opposed it. After a few hours Reid pushes it forward and Mc Connell is filibustering it?
Would such a bill be constitutional, though?
The debt ceiling is a law, not a Constitutional mandate. Congress can do whatever it wants with it, and quite frankly it's redundant with the concept of the federal budget. I personally think the debt ceiling is unconstitutional anyway.
Edit: The President is constrained by the federal budget; the executive branch cannot spend money without Congress appropriating it. The debt ceiling is an artificial constraint imposed as a way to force a cap on spending regardless of what the budget says.
At the risk of making the inaccurate comparison with household finances, let's say you set up a monthly budget of $3,000, regardless of your income. You then cut up your credit cards. So now, when your income drops below $3,000, you can't borrow money to finance your spending, so you have to cut your spending. Ergo, your budget is now meaningless.
edited 6th Dec '12 1:31:21 PM by Fighteer
"It's Occam's Shuriken! If the answer is elusive, never rule out ninjas!"![]()
Yes, because it's just giving the Executive power to execute something while still keeping a check in the form of congressional oversight.
True. Technically it's the debt ceiling that's unconstitutional.
edited 6th Dec '12 1:28:54 PM by shimaspawn
Reality is that, which when you stop believing in it, doesn't go away. -Philip K. Dick![]()
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It'd make good panto, though.
Oops... Pantomime. As 'tis the season, and all that.
edited 6th Dec '12 1:30:34 PM by Euodiachloris
Would somebody please explain how an unlimited debt ceiling will lead to anything except the government spending a bajillion dollars, and inflating the dollar until a loaf of bread costs $400?
Note: This is not Sarcasm Mode.
It was an honorBecause economics doesn't work that way?
Debt does not equate to printing money constantly. And Inflation is not necessarily affected by debt. They are two entirely different things.
What most of our debt consists of is money we owe to our own citizens, in the form of bearer bonds which need to be paid back eventually.
The debt ceiling is a formality. It's been raised at least 11 times since the turn of the millennium, 8 under Bush and a few more under Obama.
Under Bush, government basically did do that. Inflation was not that massive. We turned a surplus, the first in a long time, into a massive deficit due to several big tax breaks, two un-paid-for wars, the wallstreet crash, a tiny bit due to the recovery efforts, and miscellaneous things.
And if you're worried about hyperinflation, like in greek or post-WW 1 germany, don't be. Those are supply side problems, I think. I know Germany was, but Greece is a whole pack of problems coming together at once.
edited 6th Dec '12 2:05:18 PM by Enkufka
Very big Daydream Believer. "That's not knowledge, that's a crapshoot!" -Al Murray "Welcome to QI" -Stephen FryI'd really like to understand how that works. I mean, if I have bad credit, i.e. I don't pay my bills, banks start to restrict my credit lines until I pay it off.
The U.S. seems like it just writes itself more blank checks.
And if it's not paid back....
edited 6th Dec '12 2:05:10 PM by TheStarshipMaxima
It was an honor@Maxima: Last time I checked, you were not a sovereign state that prints its own currency.
This is the problem. People assume that country debt is like individual debt, but economics works differently on different levels. It's like trying to use quantum physics to build a bottle rocket. It doesn't work.
It's a cap on the net expenditure, though, isn't it? Not just the spending. So how much you would spend would depend on your tax revenue.
The remark about it being constitutional was just wondering if Congress can delegate powers like this to the president, when Congress is supposed to handle budgets.
I'm not the best person to talk about this for, because my economics stuff has basically been listening to Fighteer and Tomu for two years, but basically, Governments don't have debt the same way that people have debt. If people tried to cash out of the government all at once, basically if everyone called in their stuff at the same time, we'd have less debt, but we'd have to print more money.
This topic has come up before, but I can't remember how it went.
Very big Daydream Believer. "That's not knowledge, that's a crapshoot!" -Al Murray "Welcome to QI" -Stephen Fry@Oh, So - okay. I know what happens when I spend more than I make. What happens when a country does it?
So in other words, you know nothing about economics?
edited 6th Dec '12 2:09:43 PM by TheStarshipMaxima
It was an honor![]()
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People cash bearer bonds all the time. They're one of the single most stable forms of investment. That's why we have so many outstanding. They've never been defaulted on. They just mature over a long period of time. They aren't really a debt though. They're the country's people investing in the country. Calling them a debt is the same as calling a CEO's stake in the company a debt.
Hey, I know a lot of stuff! I could pass Econ 101 pretty well, thank you.
I call bearer bonds (I'm fairly certain that's wrong, though) a form of debt because it's basically the government being indebted to the holder for a period of time, which must eventually be paid back. A great metric of the faith people have in the government is interest on those bonds, but I cannot remember if that's over the short term or long term, and the lower it is, the better faith there is in the government.
But basically, right now is the time the government should be spending like mad on fixing up the infrastructure and public works and such, because interest on the debt is incredibly low. When times are better, the government needs to lower its spending and create a surplus, which has the dual effect of flattening the spike in growth (growth is not always a good thing) and depth of the eventual down-turn, as well as paying down the debt which the government has accumulated.
Very big Daydream Believer. "That's not knowledge, that's a crapshoot!" -Al Murray "Welcome to QI" -Stephen Fry@Maxima: Well, what you have to realize in this case is that when you print your own currency you effectively cannot spend more money than you have because you have unlimited moneys. But I'm guessing that's not what you're talking about.
At the stage of sovereigns and currency, what you are getting into is trading something that is fake (currency) for something that is real (labor, school buses, guns, whathaveyou). The fake things we give out for real things are essentially IO Us — this is similar to borrowing. However individuals can die, declare bankruptcy, etc. Sovereign states have a really difficult time doing that, and as far as we know into perpetuity the state will continue to be a viable entity that we can get money from. It becomes a matter of "it does not matter how slow you go so long as you do not stop." Countries and those who buy bonds are relying on the standard of living and productivity of the United States to stay constant and improve into the forseeable future. So, instead of bleeding the country dry for funds to pay off the debt which would lower standards of living and make it more difficult for the country to be productive, it is better to borrow more and invest it into the country so productivity can continue to improve to the point where either we can pay off the debt or we expand so much that the proportion of that debt is unimportant.
And, because the United States, as far as we know, is not on the verge of collapse, we can continue to rely on this image of continually getting better and paying back our debt slowly with interest.
This is why it is in fact far more dangerous to play shenanigans with our money like we did with last year's debt talks than it is to actually raise the debt ceiling. Making the country look unstable and defaulting, sucking money out of the economy, makes us look like not a good investment to other countries which makes them want their debt back, not wanting to do business with us, etc.
edited 6th Dec '12 2:19:34 PM by ohsointocats
Maxima, you asked a question about economics. What did you expect?
And basically everything that OSIC said. It's a faith-based system, but that faith is very substantial and counts for quite a lot.
Very big Daydream Believer. "That's not knowledge, that's a crapshoot!" -Al Murray "Welcome to QI" -Stephen FryActually, I've never heard of the whole "debt ceiling" concept in any country other than the USA, and most of these other countries seem to be doing just fine...
Mache dich, mein Herze, rein...If you were actually immortal and forever young and could continue working until the heat death of the universe, your finances might look a little like a sovereign nation's. A country does not grow old and come to a point where it can no longer work, at least as far as we know. So the reason why one would stop loaning to such an entity is because 1) you think they will dissolve for whatever reason 2) you think they will just decide that they have no obligation to pay their debts and will therefore stop doing so. So, lending to these entities is based on faith.
I mean it's not like lending to you or I isn't based on faith. That's what credit scores try to measure.

@ Maxster. You know what? Just pluralise my nickname. That'd be... Hopies.