Alarming times call for alarming warnings. In five days, the U.S. will have exhausted it's borrowing capacity. Jack Lew, the U.S. Treasury Secretary, have warned congressional leaders that "[i]f the government should ultimately become unable to pay all of its bills, the results could be catastrophic."
Bottom line is, we need to raise the $16.7 trillion debt limit. But the House won't vote on the debt limit until they settle the issue over the funding of Obamacare. Neither the president nor House Speaker Boehner is prepared to negotiate. If they can't reach an agreement by Thursday, the U.S. could start defaulting on its obligations as early as late October.
Tensions are high. How confident are you that Congress will be solve this issue before the October 17th deadline? Are Republicans stubborn enough to not only shut down the government, but also let the U.S. default? What does this say about our government system? Which side (Boehner or Obama) do you think is going to give in a little to the other side first? Is this a matter of pride and ambition?
4 comments:
I hope this is not just a matter of pride and ambition, but I'm sure it is to some extent. Government is made up of men, as Madison reminded us. Do you think that this points to a flaw in democracies: that people can disagree to the extent that the government is paralyzed? Or does this disagreement generally provide more helpful benefits than it provides negative ones? It's probably both.
I think both sides will have to give in some. Or at least both sides should.
But it is scary how much of an effect the US has upon other countries' economic well being.
You bring up an interesting way of thinking about it: government IS made up of men. And men are fallible. And I agree; the disagreement present in democracy is both helpful and harmful. I think it's just a matter of keeping the harmful effects of disagreement in check, which in reality, isn't possible. Strong, differing opinions will always get in the way of progress, as history has taught us time and time again.
As to your final comment, I want to mention a quote from Spider-Man: "With great power comes great responsibility." Defaulting the U.S.'s responsibilities is going to cause consequences that we can't even fully predict until it happens. Let's hope it doesn't happen.
The debt ceiling was actually reached in May of this year. The US Treasury began applying "extraordinary measures," which allowed the Treasury to continue borrowing and paying bills, but these extraordinary measures will run out on October 17th and will force the US to default. This would not only significantly damage the US economy, but the world economy as well.
Today, the Senate began talks again to attempt to reach a resolution. President Obama is still unwilling to make concessions on his Affordable Care Act, but Republicans are recognizing that a US default would be catastrophic, so hopefully a deal will be brokered soon.
I thought it was interesting how the BBC article discussed the shift of power from parties to individual candidates and redistricting as leading to more ideological politicians who lack accountability, topics we have been learning about recently in class.
I especially agree with one of its points - that given Obama's re-election last year, Republicans should know they have little chance of success in preventing the implementation of Obamaacare. If the shutdown, as the article says, stems from Boehner's ambitions and is "purely a stunt," hopefully Republicans are concerned enough about the consequences of a government shutdown to come to an agreement with the Democrats before the U.S. defaults. As Brianne said, it's scary how so many countries depend on the U.S. as the "as the anchor of the international financial system."
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