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August 2nd, 2011 9:58 pm
Why the Debt Ceiling is More Like a Debt Floor
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With the debt ceiling debate now officially behind us, most Americans will be tempted to simply exhale and move on from the psychological exhaustion of the past few weeks. Like many other conservative pundits (including our own Quin Hillyer), I have misgivings about the final agreement but generally agree that it was the best deal possible given the constraints (including Republican control of only one house of Congress).

Still, that doesn’t mean we should avoid learning the lessons of the recent dust-up, one of which is artfully put by the Atlantic’s Gregg Easterbrook (not exactly a doctrinaire conservative) writing today for Reuters:

The deal raises the federal borrowing ceiling by $2.4 trillion. This means Congress will immediately spend another $2.4 trillion. That basic point is being overlooked.

You’ve got a debt ceiling on your credit card. The ceiling is there for emergencies, and all responsible borrowers work to stay below their credit ceilings. Experience with the national debt ceiling, by contrast, shows that every dollar of available debt is always spent. Announced in doublespeak as a “savings” plan, this deal guarantees the national debt will rise another $2.4 trillion. The moment the deal becomes law, members of Congress from both parties will see an added $2.4 trillion in the cookie jar and begin raiding.

Easterbrook is right. One of the main points of contention in the recent debate was whether the President would have to come back to Congress for another debt ceiling increase within the next year or whether it would be extended into 2013 (the latter won out). But that fight misses the point. We won’t be seeing real reform until new increases in the debt ceiling become unnecessary. Until then, we’re stuck arguing over what speed to drive on the road to perdition.

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