Debt Ceiling Woes
July 20, 2011
As we sweat through mid-July, fearless leaders from both parties continue to dish out compelling soap-opera entertainment concerning the August 2 deadline for raising the 14.3 trillion debt ceiling. It is generally held that we must meet the Aug. 2 deadline in order to avoid technical default, and that the consequence of such a default would mean we’d only be able to fund fifty per cent of budgetary obligations outside of debt interest payments. Every day, it seems, each party has conjured up some novel proposal, ranging from Obama’s Grand Bargain, to the Three Installment Abatement offered by Sen. Republican leader McConnell.
Despite the grandstanding, neither party is having much success in striking up unanimity. Obama is having serious problems with those Democrats who are respecting Pelosi’s line in the sand regarding spending cuts on social programs, and the conservative branch of Republicans in the House are backing their leader Eric Cantor, resisting any revenue increases including elimination of tax loopholes. The future seems to hold nothing but confusion and confrontation