The Debt Limit: A Formal and then a Simple Primer

I wondered if it were only partisan politicking.  While that may have been the case, perhaps the continued misinformation is now regarded as the truth by both legislators and media outlets.  With all the debate last year and the ongoing “fiscal cliff” (I hate that term) talks, there appears to be increasing misconceptions as to what the debt limit or debt ceiling is.

Here is a classroom style, reading directly from notes, lecture definition:

The debt limit is the total amount of money that the United States government is authorized to borrow to meet its existing legal obligations, including Social Security and Medicare benefits, military salaries, interest on the national debt, tax refunds, and other payments. The debt limit does not authorize new spending commitments. It simply allows the government to finance existing legal obligations that Congresses and Presidents of both parties have made in the past.  Congress enacted the modern concept in the Second Liberty Bond Act of 1917 which allowed for the raising of funds in support of Allied and US involvement in the First World War.  This debt “ceiling” has been raised multiple times, over 70 times at least since 1960.  Under Republican Presidents, the limits have been raised nearly 50 times.  Under Democratic Presidents, the limits have been raised nearly 30 times.

One key to the debt limit or ceiling is that it involves only Existing obligations.  In other words, debts already incurred by the present and previous Congresses.  Another is that it does NOT authorize NEW spending.  Now who has the power under the Constitution to raise and spend money?  Sometimes I wonder if the elected officials who swear to uphold the Constitution and many of the people arguing that President Obama does not support the Constitution have ever read the complete document.  Expenditures are the result of decisions made by the respective Congresses.  The Executive Branch has the responsibility to pay those debts inherited and the checks written by the current Congress.

The Senate Minority Leader, Mitch McConnell, recently offered a different understanding on the Senate Floor.  “By demanding the power to raise the debt limit whenever he wants by as much as he wants, [President Obama] showed what he’s really after is assuming unprecedented power to spend taxpayer dollars without any limit.”  You can watch the Senate Floor proceeding here:

The editors of a city newspaper in an area where I once lived included this statement in their editorial.   “But under no circumstances should the White House be given the ability to raise the national debt limit whenever it sees fit. That is too much authority to have without the check and balance of the Legislature.”

The debt limit or debt ceiling is a Statute, not a Constitutional provision.

1) Congress alone has the power to raise revenue

2) The House of Representatives must initiate all Bills to raise revenue per the Constitution

3) When Congress spends more than it takes in, the Executive must borrow the money to fulfill the debt obligations.

4) If these financial obligations are not met, it is not simply government shutting down.  It is a default on legal obligations which would be unprecedented.

Is there too much debt?  Yes!  This solution used to be common sense, but for many today it seems extreme.  As an individual when faced with budget difficulties you can either raise more money, cut expenses, or a combination of increasing revenue and decreasing expenses.

Some questions for Republicans: 

If sufficient revenue to pay past debts can be obtained through the closing of loopholes, weren’t those loopholes too big?  Seriously, if those benefitting from the loopholes cannot afford to pay extra taxes without stifling the economy, why the heck is the economy in trouble and the debt so large today?  What did they do with all that money they kept from the loopholes?  Obviously they weren’t investing in job creation and rebuilding the infrastructure.  Am I wrong to think that gains from those loopholes came at the expense of someone or something else?  Perhaps closing those loopholes might have decreased the expansion of the deficit that’s everyone’s concern at the moment?

Some questions for Democrats:

How freaking inefficient can some things be?  Don’t you think some of these non competitive bids accepted from the private sector to provide goods and services are a little bit pricey?  Was there a reason to not compare and contrast proposals?  We know that straw cannot be spun into gold, but have you developed a money tree that anyone can plant?

Whether Professor of History, barefoot boy in the field, or wearing school britches and shoes in the public school system of Livingston Parish:

I realize that everyone knows everything, and someone like me with degrees in history is considered qualified to play trivia games but not capable of any “real” thinking or work, so let’s think in simple terms.  I may be called a Professor of History, but seriously I learned this as a boy on a strawberry farm, and practically all my public school teachers would explain things in a similar fashion.  So regardless of formal education level, try imagining this situation.

A) You need water some place in the field. (Plants will die without water, among other things).

B) You attach your water line to the well head, and stretch the hose or pipe across the field to where you need the H2O.  (Many places today even have municipal water service where it is simply lining up the threads on the spigot with the threads on the hose and turn the sleeve clockwise to tighten).

C) You open the valve to let the water flow into the line or hose

D) You walk to the other end of the line or hose and dispense the water as needed since it should be flowing out of that end

But what if there is no water coming out from that end of the hose or pipe?  What should you do?

It might be deep or intellectual thinking here, but first you wait for a little bit because maybe you walked at a faster rate than the water has traveled   After a short wait, if you still do not have flowing water you don’t go back to the well head or spigot and increase the pressure in the line by opening the valve more without examining the hose or line walking back.  Repeat, you must examine the structure transporting the water.

E) You walk the length of the entire line, find and plug any leaks, and remove any obstructions.  When there is a leak, increasing volume only increases the size of the leak.  If there is an obstruction that is really solid, the increased volume and pressure may result in the water backing up or may cause the line to explode.

F) In some cases you might move the obstruction farther down or possibly out of the line altogether by increasing the water flow and pressure.  Still, you have to be prepared for the results of pressure burst, and increased amount of water on the other end.

G) In some cases, the leaks and the obstructions might make it necessary to install a new line.  Also, if the place in need of water is really isolated or you know this need is a rare event, it just might make more sense to fill a bucket or watering can and walk it out to the area.  There might not be a true need to invest in the cost of materials, labor, and time to repair the old line or install a new line.

Now here’s the public school application part:

In other words, if something ain’t working right simply pouring more money into the process ain’t gonna fix the problem.  Chances are the problem is just gonna get bigger and you’re gonna have a big mess to clean up.  A lot of good people truly need a little assistance to get back on their feet, but that assistance is not reaching them but being lapped up by varmints waiting at the leaks along the path because it is much easier for them than walking to the river over yonder and taking a drink there.

My Dad and my grandfather taught me that you cannot find a solution until you first identify the problem.

Why are the current discussions or bickering about the results of the problems and not about the problems and the causes of those problems?