US with problems to raise the debt ceiling... again

[paxmao]

Again, the US Government has spent more than expected and now has to borrow more to pay the bills. If this was you, this is the closest to an overdraft on your account that a country gets. The problem is that the limit has to be raised by law, and it is not simple to do so in an age of exacerbated partisanship and little wide-angle vision about the needs of the country.

Incredible as it may seem, the US could actually default in its obligations.

https://www.nytimes.com/2021/09/26/business/economy/america-debt-limit-political-game.html

[1714881320]

1714881320

[1714881320]

1714881320

[Hydrogen]

Today's vote is against raising the debt ceiling.

I seem to remember the last shutdown occurring when Obama was President. Not everything closes down. Essential segments of the government continue running.

Government Shutdown Looms as Senate Republicans Block Debt Ceiling, Funding Bill

After clearing the House last week in a party-line vote, Senate Democrats failed to sway 10 Republicans to reach the 60-vote threshold needed to overcome a filibuster and move forward with the continuing resolution that would, among other things, keep the government funded at current levels through Dec. 3. No Republicans supported the procedural vote.

Monday's unsuccessful vote puts pressure on Democrats to rethink how they'll renew government funding over the next few days. If a short-term plan doesn't clear Congress and get signed into law by midnight Thursday, the government faces a shutdown the next morning.

https://www.msn.com/en-us/news/politics/government-shutdown-looms-as-senate-republicans-block-debt-ceiling-funding-bill/ar-AAOT0hw

On the bright side, if a shutdown occurs, they can't vote on or pass the infrastructure bill containing crypto regulation (which many disapprove of).

I'm surprised to see this much disagreement between parties. The current era could be the most centralized the US government has been in its history.

They have until thursday to raise the debt ceiling.

[Poker Player]

Incredible as it may seem, the US could actually default in its obligations.

Yeah, but would anyone bet on it?

The normal scenario is that there will be a lot of debate and a lot of drama, but when two are forced to understand each other because if they don't the outcome is worse for both, they end up doing it.

[Sithara007]

The republicans did the right thing by blocking it. Biden just want to borrow trillions of USD and then spend a large part of it on the most unproductive sectors of the US economy. It is just like putting all that money in to a black hole. Unless the Democrats come up with a more unbiased plan, the GOP should block whatever bill they bring. The US federal debt has already crossed $28.8 trillion, and now stands higher than the GDP. GOP needs to oppose it, because when they get back to power in either 2024 or 2028, they will face issues from this ballooning debt.

[so98nn]

It’s funny how governments work around the clock and still fails to accommodate the typical economic cycle. I’m wondering how country like US can go in debt if most of the income is from Home production and worth to note that they are the biggest supplier of biological products to high end machine and what not. They should be one giving out the loans and not borrowing to overcome their own situation.

Is it has got to do anything with money being spend on the crypto and taxes are not being filed? Could crypto be that effective to make the economic situation worst like this?

[Kittygalore]

They won't collapse that easily though, I am pretty sure that the government and it's oligarch friends is going to make sure that they're going to survive and the country they're exploiting is going to survive too. There's also that conspiracy that those debts that they had are already paid, and they just don't say it's already paid, that's why they're surviving doing this kind of thing.

[Kong Hey Pakboy]

If the country fails to meet its borrowing limits within the current period to overcome the financial situation and economic problems, it will be a dangerous event that will have a dangerous impact on the developing world developing economies will also be hit if the US government fails to take action interest rates will rise confidence will decline and economic growth will slow. It will further worsen the economic situation in the united states.

It's a different story for US though, I think they have enough influence to not follow the stuff that most countries abide by when it comes to borrowing stuff. They already have the solution in their country, and that would be taxing the uber rich people and companies in their country.

[aysg76]

Again, the US Government has spent more than expected and now has to borrow more to pay the bills. If this was you, this is the closest to an overdraft on your account that a country gets. The problem is that the limit has to be raised by law, and it is not simple to do so in an age of exacerbated partisanship and little wide-angle vision about the needs of the country.

Incredible as it may seem, the US could actually default in its obligations.

https://www.nytimes.com/2021/09/26/business/economy/america-debt-limit-political-game.html

The main problem is that government has no limits whether it's debt raising or money printing.Why? Because the lawmakers are the one running government and it's not the case with only US but if you monitor the charts you will find similar situations for most of the countries.The reason for it the same old one which is cost of living and inflation has been on significant rise from the past.The Dollar and Euro have lost major value after the Breton woods Agreement.The countries Debt to Gdp ratio has also been rising from long time as depicted in the charts:



You need to take care of your future safety and to have secured funds at that time so choose wisely as the government will not have an efficient solution for these problems.

[davis196]

The republicans did the right thing by blocking it. Biden just want to borrow trillions of USD and then spend a large part of it on the most unproductive sectors of the US economy. It is just like putting all that money in to a black hole. Unless the Democrats come up with a more unbiased plan, the GOP should block whatever bill they bring. The US federal debt has already crossed $28.8 trillion, and now stands higher than the GDP. GOP needs to oppose it, because when they get back to power in either 2024 or 2028, they will face issues from this ballooning debt.

I don't believe that the Republicans will be stupid enough to cause the default of the USA.Such default might cause a gigantic global financial crisis,maybe a new Great Depression,in times of a global Pandemic.
This seems like the perfect disaster,and the Republicans might take all the blame for causing such disaster,so I don't think that they will keep blocking the debt ceiling increase.
Like other members said,there will be some drama in the US congress,but both parties will eventually agree to an increase of the national debt,because there aren't any alternative solutions to the US debt problem.  

[leea-1334]

It’s funny how governments work around the clock and still fails to accommodate the typical economic cycle. I’m wondering how country like US can go in debt if most of the income is from Home production and worth to note that they are the biggest supplier of biological products to high end machine and what not. They should be one giving out the loans and not borrowing to overcome their own situation.

Is it has got to do anything with money being spend on the crypto and taxes are not being filed? Could crypto be that effective to make the economic situation worst like this?

Actually,,, I always thought that governments are the ones working the least In my country now, you can get the least working hours simply by working for the government!

But jokes aside,,, if a government is well run and the economy is healthy, they actually do not have to work round the clock.

And the answer to your debt is war. You know the US government borrows from the Feds billions to go to war right? 6 Trillion debt in 20 years

China owns 1 Trillion of US debt by the way

[ven7net]

Again, the US Government has spent more than expected and now has to borrow more to pay the bills. If this was you, this is the closest to an overdraft on your account that a country gets. The problem is that the limit has to be raised by law, and it is not simple to do so in an age of exacerbated partisanship and little wide-angle vision about the needs of the country.

Incredible as it may seem, the US could actually default in its obligations.

https://www.nytimes.com/2021/09/26/business/economy/america-debt-limit-political-game.html

There is nothing surprising in this, the United States has not fulfilled its obligations for a long time and what should it do the same this time. And all due to the fact that the US policy turned out to be erroneous and at the moment we see how all institutions, both in power and in finance, are crumbling. Which ultimately led to the fact that no matter how much new money was printed in the United States, it will only get worse. The same applies to the obligations that the United States has assumed, they can no longer comply and fulfill them, since there are no more resources for this either. As a result, the United States is currently on the path to collapse. Perhaps they will be able to hold out a little longer, but in the end, sooner or later, the system will come to a complete dead end and the inevitable will happen - collapse.

[AicecreaME]

Again, the US Government has spent more than expected and now has to borrow more to pay the bills. If this was you, this is the closest to an overdraft on your account that a country gets. The problem is that the limit has to be raised by law, and it is not simple to do so in an age of exacerbated partisanship and little wide-angle vision about the needs of the country.

Incredible as it may seem, the US could actually default in its obligations.

https://www.nytimes.com/2021/09/26/business/economy/america-debt-limit-political-game.html

This is a problem that they need to address as soon as possible before it gets out of hand. I don't think raising the limit should be one of their top priority to pay existing bills. The US government has to learn good financial decision-making to avoid this kind of scenario. Surely they have their great accountants in the department of finance, it is just that the officials decided to take a wrong turn making a bad decision that cost this to happen. Hopefully, they'll be able to handle this. They are the US after all. They won't stumble that fast.

[tyz]

China owns 1 Trillion of US debt by the way

Not only China, but Japan and many other countries own a lot of U.S. government bonds, too. The USA is immensely dependent on foreign countries. If at some point these countries decide to stop buying U.S. government bonds, the U.S. will no longer be able to issue any debt at all in this form without its currency collapsing.

[o_e_l_e_o]

GOP needs to oppose it, because when they get back to power in either 2024 or 2028, they will face issues from this ballooning debt.

The ever increasing debt and printing ever more money to deal with it is obviously a problem, but painting the GOP as the party of fiscal responsibility is laughable. They borrow and print more with abandon when they are in power, and then blame the Dems for it when they are not in power. Republican presidents have overseen the largest increases in the deficit and in the debt over the past 40 years, whereas both Clinton and Obama greatly reduced the deficits they inherited, with Clinton being the only president in the last 40 years to turn a surplus.

The debt ceiling was increased three times under Trump. If Trump was in office just now, Republicans would have no issues increasing it again. They are doing this for their own political gain, not for any concern about our ballooning debt. Everyone knows it will be raised eventually, since the US defaulting on its debt would ruin the country, but Republicans have to play their stupid little games first.

[oHnK]

The main problem is that government has no limits whether it's debt raising or money printing.Why? Because the lawmakers are the one running government and it's not the case with only US but if you monitor the charts you will find similar situations for most of the countries.The reason for it the same old one which is cost of living and inflation has been on significant rise from the past.The Dollar and Euro have lost major value after the Breton woods Agreement.The countries Debt to Gdp ratio has also been rising from long time as depicted in the charts:

There are no restrictions on printing money and debt due to the decision of the former US president himself who decided not to be bound by Breton Woods, since then the freedom of governments in all countries to manage their version of the financial system is not controlled.  The US as a country whose currency is the standard in all countries, has inflated its economy through debt.  Likewise other countries that follow the policies taken by the US.  Funnier is the current condition, it seems that it is normal for the government to issue bonds and pay their maturity by issuing new bonds again.  And so on, so that this debt will continue to increase and will never decrease as long as the system used is still floating value like this and does not have underlying assets.

[stompix]

The Dollar and Euro have lost major value after the Breton woods Agreement.

How could the Euro who was launched in 1999 lose value after an agreement that happened half a century earlier?  

As for the debt ceiling,

The debt ceiling has been changed 104 times since 1944 - 94 increases and 10 decreases

every single time the same, if just a political game, the opposition is against it to put pressure on the party who runs the country, nothing else, nobody really wants a complete shutdown, they use this as a bargain to reach agreements.

I'm far more concerned about that 3.5 trillion bill, which will come with a lot of headaches and will just amplify what's happening, is not enough that the snowball is rolling downhill anyhow on it own, you feel the need to give it a serious push.

Not only China, but Japan and many other countries own a lot of U.S. government bonds, too. The USA is immensely dependent on foreign countries. If at some point these countries decide to stop buying U.S. government bonds, the U.S. will no longer be able to issue any debt at all in this form without its currency collapsing.

Foreigners hold only 30% of the debt, the US can still run its debt even without them with just the the Federal Reserve.
Besides, none of that country would want to see the $ collapsing, 2007 was a clear example of what happens if the US is in trouble, if the $ goes down so does China as it's so dependent on the US for its exports, where are all the goods going to go, what are your going to dow with all the workers and all the companies? No country other than NK really wants the $ to collapse for real, politics and briefings and propaganda are one thing, the situation coming real would hurt everybody eveywhere.

[bryant.coleman]

The ever increasing debt and printing ever more money to deal with it is obviously a problem, but painting the GOP as the party of fiscal responsibility is laughable. They borrow and print more with abandon when they are in power, and then blame the Dems for it when they are not in power. Republican presidents have overseen the largest increases in the deficit and in the debt over the past 40 years, whereas both Clinton and Obama greatly reduced the deficits they inherited, with Clinton being the only president in the last 40 years to turn a surplus.

The debt ceiling was increased three times under Trump. If Trump was in office just now, Republicans would have no issues increasing it again. They are doing this for their own political gain, not for any concern about our ballooning debt. Everyone knows it will be raised eventually, since the US defaulting on its debt would ruin the country, but Republicans have to play their stupid little games first.

The GOP used to be a party of "fiscal responsibility" until two decades ago. Back then, they used to depend heavily on suburban white voters and a seizable chunk of their votes used to come from white collar workers. However, suburban voters have moved towards the left recently, and it is more noticeable among the female suburban voters. The Iraq war, which was initiated by George W Bush just destroyed whatever reputation they had in fiscal responsibility.

And by the time Trump was voted to power, the core support group was white blue collar workers. Suburban areas, where the GOP used to receive 60% or more of the votes now vote >60% for the Dems. Under these circumstances, it makes perfect sense for the GOP to cater to their core support group. And doing that means handing out more welfare benefits, thereby widening the fiscal deficit.

[Sterbens]

Finally this news has reached our ears. From the point of view of the increasingly clear US economic downturn, Biden seems unable to overcome the upheaval by increasing the competitiveness of the global economy. Adding debt is the last resort? embarrassing isn't it?

Of course, it cannot be separated from the various effects that will later have a more dominant impact on the government shutdown and also of course as the point of origin to witness in US history leading to the financial crisis. But don't forget that even during Trump's time, the same thing happened, namely for 35 days to be exact in December 2018.

As Senator Schumer put it "It's playing with fire. Playing with the debt ceiling is playing with fire and putting it on the backs of the American people" Lol what's up with the US becoming increasingly estranged from the power of the powerful world economy?

This is a heavy blow after Covid 19 America has had some kind of difficulty in recovering the economy.

[o_e_l_e_o]

The GOP used to be a party of "fiscal responsibility" until two decades ago.

I don't think that's true either. In terms of percentage, outside of the two World Wars, Reagen added more to the debt by a long shot than any other president, with Bush 43 coming 2nd.

Under these circumstances, it makes perfect sense for the GOP to cater to their core support group. And doing that means handing out more welfare benefits, thereby widening the fiscal deficit.

GOP handing out welfare benefits? What? The GOP consistently push to cut Medicaid, Medicare, and a variety of social security programs such as SNAP and TANF. Trump's big tax cuts, which contributed to a big chunk of his increased deficit prior to COVID, largely benefited the wealthiest in society - https://www.taxpolicycenter.org/publications/distributional-analysis-conference-agreement-tax-cuts-and-jobs-act/full. The top quintile made a saving of over $7,000 per year, with the lowest quintile making a saving of only $60 per year. How you can say that is catering to blue collar workers I don't know.

[Fortify]

Again, the US Government has spent more than expected and now has to borrow more to pay the bills. If this was you, this is the closest to an overdraft on your account that a country gets. The problem is that the limit has to be raised by law, and it is not simple to do so in an age of exacerbated partisanship and little wide-angle vision about the needs of the country.

Incredible as it may seem, the US could actually default in its obligations.

https://www.nytimes.com/2021/09/26/business/economy/america-debt-limit-political-game.html

It is crazy that this happens so often, it seems to be every year or two now. What sort of country allows their system of government to bring the whole country to a halt as the (only) two political parties, full of rich old people, engage in some pathetic brinkmanship in order to try and extract the most leverage out of the other side while receiving the least bad publicity. Fixing this constantly reoccurring situation should be the absolute priority of all US politicians because it causes so much unnecessary anguish repeatedly. America already has enough problems without millions of people wondering if they will wake up on a certain date and possibly be going to work unpaid when they have regular bills to clear.