It seems as if our government enjoys being in crisis mode. We always have to do something (usually involving a great deal of spending) in order to ward off the next crisis. The current crisis is that we are reaching the debt ceiling and will not be able to borrow any more money. Good. I hate to be difficult, but good.
Yesterday the Heritage Foundation posted an article entitled, "Myth-Busting the Debt Limit." Sounds like a great idea.
The first thing pointed out in the article:
"...But Heritage Foundation Vice President of Domestic and Economic Policy David S. Addington notes that those dire predictions just aren't true. In discussing J.D. Foster's paper "Congress Has Time and Options on Debt Limit," Addington writes:
"As Dr. Foster's paper demonstrated, there will not be a default on the Federal debt when the Treasury reaches the statutory limit on its borrowing of $14.294 trillion. The Treasury just will not be able to borrow any more money. The Treasury would still pay debts that come due, putting off temporarily payment of less important obligations as necessary to pay the maturing debt.
"President Obama's prophecies about the debt limit obscure an underlying truth: The U.S. government must find a way to get control of spending. Simply raising the debt limit and allowing the United States to borrow more money, unchecked, will not make that happen. To that end, in an interview with The Wall Street Journal, investor Stanley Druckenmiller warns that defaulting on the debt is not the real problem Wall Street should be worried about:
"In the future, he says, "People aren't going to wonder whether 20 years ago we delayed an interest payment for six days. They're going to wonder whether we got our house in order.""
Reaching our debt ceiling is not a good thing, but it means that we need to control spending--not that we need more debt. Can you imaging running a household budget this way?
It's time for the Obama administration to get spending under control--not ask to borrow more.
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