Freedom Line Blog

CFIF’s Renee Giachino discusses the debate over raising the debt ceiling.  Giachino urges conservatives in Congress to stand firm on “real and deep” spending cuts against a President and Congressional Democrats who wish to raise the nation’s debt limit without any cuts to spending.

CFIF Vice President for Legal and Public Affairs Timothy Lee discusses the pending debate over the debt ceiling and how lawmakers need to better understand that wealth is created rather than “distributed.”

Listen to the interview here.

The Washington Post has a helpful – and short – explanation of the debt ceiling debate, along with some interesting facts.  *My comments in ( )

• Prior to 1917, Congress had to approve borrowing each time it came up (meaning that WWI combined with Progressive Era big spending made raising the debt much easier)

• Members of Congress will most likely wait use July 8^th as the drop-dead date (unfortunately, federal pensioners will see government contributions to their retirement funds halted when the U.S. passes the real deadline on May 16^th)

• The debt ceiling was less than $1 trillion in the 1980s, then $6 trillion in the 1990s; today it stands at $14.6 trillion and rising (and no, simple inflation is not the reason – it’s spending increases)

• The budgets presented by President Barack Obama and Rep. Paul Ryan would both require a raise in the debt ceiling (Obama by $2.2 trillion; Ryan by $1.9 trillion)

Read the entire synopsis here.

Byron York of the Washington Examiner says that although many Republicans will be tempted to let the debt ceiling debate go down to the wire, most of them will eventually vote to raise it.

The bottom line is, the debt ceiling issue won’t be settled before an extended game of chicken, one in which Republicans will undoubtedly win some concessions but will, in the end, have to give in.

With the Tea Party still licking its wounds after a much less-than-expected cut in current federal spending, don’t be surprised if raising the debt ceiling becomes the issue upon which many activists base their support for Republican members of Congress.

Sen. Kay Bailey Hutchison (R-TX) calls the next fiscal fight – raising the statutory debt limit when it’s reached in May – “Armageddon” and the most important policy decision of most members’ careers.

Check out her explanation here.

Republicans in Congress are currently split on whether to accept incremental budget cuts in the name of political pragmatism or to hold a hard line — and face the possibility of a government shutdown or a freeze in the debt ceiling — in the name of principle. Freshman Florida Senator Marco Rubio takes to the editorial pages of the Wednesday edition of the Wall Street Journal with a message that leaves no doubt where he stands:

“Raising America’s debt limit is a sign of leadership failure.” So said then-Sen. Obama in 2006, when he voted against raising the debt ceiling by less than $800 billion to a new limit of $8.965 trillion. As America’s debt now approaches its current $14.29 trillion limit, we are witnessing leadership failure of epic proportions.

I will vote to defeat an increase in the debt limit unless it is the last one we ever authorize and is accompanied by a plan for fundamental tax reform, an overhaul of our regulatory structure, a cut to discretionary spending, a balanced-budget amendment, and reforms to save Social Security, Medicare and Medicaid.

For months now, we’ve heard “sober” politicians tell us that it’s time to have “an adult conversation” about the size and cost of government in which “everything is on the table”. It looks like Marco Rubio is calling their bluff.

Yesterday, CFIF Senior Fellow Troy Senik described the different approaches Senators Richard Lugar (R-IN) and Orrin Hatch (R-UT) are taking toward their state’s Tea Party movements.  Hatch is accommodating while Lugar is dismissive.

Count Senator Olympia Snowe (R-ME) in the Hatch camp.  The Maine moderate is raising the eyebrow of one home-state commentator by giving a lengthy response to questions about opposing Sharia law, repealing ObamaCare, increasing the debt ceiling, and Social Security spending, among other issues.

Snowe should get credit for answering those questions publicly and in-depth.  Time will tell if it helps her win another term in 2012.

Below is one of the latest cartoons from two-time Pulitzer Prize-winner Michael Ramirez.

View more of Michael Ramirez’s cartoons on CFIF’s website here.

Since a majority of the smart people in Washington, D.C., agree that the nation’s astronomically high $14.3 trillion debt ceiling, chattering class consensus says all the “sane” members of Congress will stand together and once again extend America’s line of credit.  With that in mind, GOP budget cutters are proposing to get deep spending cuts in return for raising the debt ceiling.

Not so fast, says Federal Reserve Chairman Ben Bernanke.  Playing his faux apolitical persona to the hilt yesterday, Bernanke said House Republicans should “not play around” with the debt ceiling vote to extract any spending concessions.  That would make a fiscal issue too political.  Instead, they should treat spending and tax issues separately; exactly the unconditional debt raising approach espoused by the Obama Administration.

But the logic of the Republicans’ negotiating tactic is clear: get spending cuts now so that the debt limit becomes a true ceiling once more instead of a temporary marker.  Having a limit on one’s credit card does not require the user to treat it as a goal.  It’s an emergency option, not a default.  Because fiscally conservative House and Senate members are the only public officials actually trying to get control of the budget, demanding concessions from the debt ceiling vote may be the only way to make progress in a fractured government.

If Bernanke is too partisan to see that, he should at least recognize that politics isn’t just an exercise in means; it’s the attainment of principled ends as well.

According to a Reuters/Ipsos survey released today:

The U.S. public overwhelmingly opposes raising the country’s debt limit even though failure to do so could hurt America’s international standing and push up borrowing costs…

Some 71 percent of those surveyed oppose increasing the borrowing authority, the focus of a brewing political battle over federal spending. Only 18 percent support an increase.

But other than curtailing foreign aid and tax collection, which is supported by 73 percent and 65 percent of respondents respectively, the public is split on exactly what federal spending to cut.  And on the issue of entitlements (Social Security and Medicare specifically), which are by far the greatest contributors to the nation’s mounting debt, a large majority of Americans are seemingly saying “hands off,” according to the survey.

The U.S. National Debt is fast approaching the nation’s $14.3 trillion statutory borrowing  limit set by Congress back in February.

According to the U.S. Treasury, on December 31 the National Debt stood at a whopping $14,025,215,218,708.52, breaking the $14 trillion mark for the first time in our nation’s history.  As CBSNews.com reported yesterday: 

It took just 7 months for the National Debt to increase from $13 trillion on June 1, 2010 to $14 trillion on Dec. 31. It also means the debt is fast approaching the statutory ceiling [of] $14.294 trillion set by Congress and signed into law by President Obama last February.

Congress must get serious about implementing significant across-the-board spending cuts and it should use the pending vote on the debt ceiling to ensure that happens.  Furthermore, we need to stop the bleeding by forcing Congress and the president, via a constitutional amendment, to present and pass a balanced federal budget annually without raising taxes.