THIS IS A LIE!
Follow the link in that phrase to read an AP article that is just LYING to you. (Unless, of course, we're borrowing money just to make our debt payments. In that case, we can all just put our heads between our knees and....)
I've heard it for months now. If the Congress does not raise the debt ceiling the United States will default on its loans outstanding. In other words, people in the Obama administration, the US Congress, and the press are saying that if we can't borrow more money, we'll stop paying on the debts we ALREADY have.
I'm not sure how responsible people can continue to parrot this alarmism.
Here's the deal: The United States has a debt. That is the total amount of money borrowed from others and used to fund our government operations.
The United States also has a deficit. That is the annual amount of money our government budgets to spend in excess of its "income" from taxation of its people and its corporations.
Those two terms are often used interchangeably, but in truth they are VERY different.
The issue at hand is whether or not Congress should raise the DEBT ceiling. In other words, the Obama administration and the Democrat members of Congress are asking that they be legally allowed to borrow more money. Essentially, they want to take out another mortgage and promise to repay it later.
Our current debt ceiling is just over $14 trillion. And ... we have almost that amount of debt on the books right now. If Congress doesn't change the law, we won't be able to issue more bonds and borrow more money.
Our current GDP is somewhere around $15 trillion. In other words, we owe almost as much as our entire country PRODUCES in one year. If every person and every company in America were to pay 100% tax - no food, no mortgage, no energy; just taxes - for one year, we would be able to pay off the principal on our loans. Of course, at the end of the year, there wouldn't be much left of the country, either.
So, the president is asking for more. If our government is not allowed to borrow more money, then it cannot expand programs. It will be forced to "live within its means" just like its citizens!
But failing to raise the debt ceiling will have no effect on the country's ability to repay its existing debt. That money is provided for each year in the annual budget which, by law, must be completed by October of the year previous. Unfortunately, the outgoing Congress failed to pass a budget in 2010 which would have provided for 2011. Many blame Republicans for this, while ignoring the fact that the Democrat party controlled (by HUGE majorities) the House and Senate since 2007 and the Presidency since 2009.
So, it feels like I keep almost making my point. For a government official or a "journalist" to allow anyone to believe that failure to raise the amount of money the government can legally borrow will result in a government shut-down or a government default on our debt is ABSOLUTELY IRRESPONSIBLE!
It will not happen. We will continue to pay our debts. We may be forced, however, to examine our on-going government programs and operations and make some reductions.
I personally think those reductions should be very targeted and begin with redundant bureaucracy, such as BATF&E and FBI. After all, they both have inter-state powers to pursue violent criminals. Or non-productive departments such as the Department of Education. After all, there are no Federal Elementary Schools, or Federal Universities. Who is the Department educating, exactly? The National Endowment for the Arts and the Department of Energy are other easy targets.
The list can go on for pages.
Before we allow ourselves to get worked up over the "news", we HAVE to engage our brains when we hear claims that are "too bad (or good) to be true".
Follow the link in that phrase to read an AP article that is just LYING to you. (Unless, of course, we're borrowing money just to make our debt payments. In that case, we can all just put our heads between our knees and....)
I've heard it for months now. If the Congress does not raise the debt ceiling the United States will default on its loans outstanding. In other words, people in the Obama administration, the US Congress, and the press are saying that if we can't borrow more money, we'll stop paying on the debts we ALREADY have.
I'm not sure how responsible people can continue to parrot this alarmism.
Here's the deal: The United States has a debt. That is the total amount of money borrowed from others and used to fund our government operations.
The United States also has a deficit. That is the annual amount of money our government budgets to spend in excess of its "income" from taxation of its people and its corporations.
Those two terms are often used interchangeably, but in truth they are VERY different.
The issue at hand is whether or not Congress should raise the DEBT ceiling. In other words, the Obama administration and the Democrat members of Congress are asking that they be legally allowed to borrow more money. Essentially, they want to take out another mortgage and promise to repay it later.
Our current debt ceiling is just over $14 trillion. And ... we have almost that amount of debt on the books right now. If Congress doesn't change the law, we won't be able to issue more bonds and borrow more money.
Our current GDP is somewhere around $15 trillion. In other words, we owe almost as much as our entire country PRODUCES in one year. If every person and every company in America were to pay 100% tax - no food, no mortgage, no energy; just taxes - for one year, we would be able to pay off the principal on our loans. Of course, at the end of the year, there wouldn't be much left of the country, either.
So, the president is asking for more. If our government is not allowed to borrow more money, then it cannot expand programs. It will be forced to "live within its means" just like its citizens!
But failing to raise the debt ceiling will have no effect on the country's ability to repay its existing debt. That money is provided for each year in the annual budget which, by law, must be completed by October of the year previous. Unfortunately, the outgoing Congress failed to pass a budget in 2010 which would have provided for 2011. Many blame Republicans for this, while ignoring the fact that the Democrat party controlled (by HUGE majorities) the House and Senate since 2007 and the Presidency since 2009.
So, it feels like I keep almost making my point. For a government official or a "journalist" to allow anyone to believe that failure to raise the amount of money the government can legally borrow will result in a government shut-down or a government default on our debt is ABSOLUTELY IRRESPONSIBLE!
It will not happen. We will continue to pay our debts. We may be forced, however, to examine our on-going government programs and operations and make some reductions.
I personally think those reductions should be very targeted and begin with redundant bureaucracy, such as BATF&E and FBI. After all, they both have inter-state powers to pursue violent criminals. Or non-productive departments such as the Department of Education. After all, there are no Federal Elementary Schools, or Federal Universities. Who is the Department educating, exactly? The National Endowment for the Arts and the Department of Energy are other easy targets.
The list can go on for pages.
Before we allow ourselves to get worked up over the "news", we HAVE to engage our brains when we hear claims that are "too bad (or good) to be true".
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