Debt-finitely Not Cool!

Chances are, if you turned on the news in the past few weeks, you will have heard the term "debt ceiling" about 14 trillion times and (should) have heard that this is the first time since the enactment of the debt ceiling nearly a century ago that Congress may not raise it in time to prevent the Treasury from not meeting our existing financial obligations.

That is exactly what the debt ceiling issue ought to be about: meeting our existing financial obligations. Sadly, the Republican Party has taken this issue as a hostage in order to pursue extremist liberal ("libertarian" in American English) goals. There is a time and place to discuss the importance of fiscal responsibility, of which the federal government has lost sense for the majority of the past three decades. Just within the past decade, the American taxpayer has seen immoral fiscal priorities such as the War on Terrorism, the Bush tax cuts, Medicare Part D, TARP/other corporate bailouts, and "stimulus" spending/tax cuts. There is enough fiscal irresponsibility blame to go around among both parties.

However, amidst the biggest crisis our country has faced since 9/11, it has become increasingly clear that one party has taken it upon themselves to take the full burden of blame. The Republican Party is not to blame for expressing their ideas on fiscal policies and priorities, because the sharing of a variety of political viewpoints is the beauty of a democratic system. The blame the GOP must take is that of making an apolitical issue political and for dragging out its showmanship for so long. Either it fails to understand or simply does not care that failure to raise the debt ceiling not only has dire repercussions domestically, but also internationally. To me, it is one thing to shoot oneself in the foot, but it is a completely different story to shoot others in the foot. When one controls such a large share of global economic output, inevitably one must consider those that lie beyond our shores. This is something that the Chinese Communist Party does not comprehend and something that the Tea Partiers abhor. Unfortunately, the latter group has hijacked the historically procedural vote to raise the debt ceiling, sending the global economy into a bleak economic future.

To complicate matters even further, there are now calls among some Democrats for President Obama to exercise his alleged constitutional right to act unilaterally. Not only is this the result of massive failure on the part of the legislative branch to do its constitutional duty, but it would set an egregious precedent in which the separation of powers is blurred.

After all is said and done, I am opposed to the idea of structural debt, because even today we are paying off deficits from over three decades ago. However, the expenses have already been made long before most of the current members of Congress took their oath of office. Like so many have said over the past few weeks, it would be irresponsible for the government not to pay for goods and services we have already received. After the House overwhelming rejected the Senate plan this afternoon, it is suddenly very unlikely that an agreement will be reached before the August 2 deadline.

Update: Just after 4pm on Monday, August 1, the House passed the deal struck by the White House and Congressional leaders over the weekend. This deal is drenched in the political rhetoric that has dominated the debate on raising the debt ceiling. While it has prevented global economic catastrophe, the legislation has potential to still create an enormous amount of havoc for the average American family and the long-term economic outlook for the United States. While I am completely in favour of finding fiscally responsible ways to cut spending while raising revenue, I remain firmly opposed to any attempts such as this bill to tie politics with the increase in debt ceiling.