When you open your monthly bill from Visa V -1.37% or Mastercard, have you ever thought of telling the credit card company you cannot possibly pay even the minimum balance due, and you are going to have to default on the debt, unless the company immediately increases your credit limit? What do you think your creditor would tell you if you did? Would you expect to get the increase in your credit limit that way?http://www.forbes.com/sites/peterferrar ... 6129ac338e
That is the same silly, illogical argument that your President Barack Obama is peddling to the entire country, to considerable success, given the fundamental breakdown in this generation’s ability to handle self-government. Not raising the debt limit does not mean defaulting on the national debt, any more than not increasing your credit limit means you can’t pay your monthly credit card bill, and must default on that.
As the outstanding federal debt becomes due, it can simply be paid by newly issued debt, without violating the debt limit, as the total outstanding debt would not change. President Obama’s own budget estimates total net interest on the national debt for this year currently totals $223 billion. But his budget also estimates total federal income taxes for this year at $1.7 trillion, or $1,700 billion. So just as you use a small portion of your monthly earnings to pay your credit card bill, current federal tax revenues are more than enough to pay the current interest due on the national debt. So not increasing the national debt does not mean defaulting on the national debt. QED.
But President Obama says without increasing the debt limit, he cannot cover all of the federal government’s spending for the year, and he cannot decide what to prioritize to spend the continuing federal income on first. But this is why with no executive experience, or any other experience except rabble rousing, he had no business running for President in the first place.
But President Obama says Congress must raise the debt limit just to pay the bills we already owe. But if you gain a credit limit increase on your credit card, and you charge still more, is that paying the bills you already owe? Or is that racking up still more bills?
Similarly, raising the debt limit so the federal government, with nearly $17 trillion in national debt (more than our entire economy), can borrow still more does not involve paying the bills we already owe. It means racking up new bills to be paid in the future, by our kids. At best, if the increased borrowing is used to pay current federal bills owed, that involves deferring payment of current obligations, not paying what we already owe.
But President Obama is doing a good job of just confusing and manipulating the American people on this issue, as too many voters do not understand federal finances ...
The debt limit increase is for the future not for the past.
You make up your family budget and you commit to spend so much you have a house mortgage you have a car payment you have a bill for direct tv, you have debt on your credit card you have a gym membership fee.
Now you realize you can not pay them all. After paying your credit card debt payment you realize that for the rest of the year, or month whatever I cant pay all the other things so I must make decisions. I cancel my gym membership, I sell my car and buy a less expensive one. I might have to sell my house and downsize that. I may have to cancel or downsize my direct tv bill. You have to make decisions.
Why should not the federal government have to live withing its means. Make do with what you have.