removing the debt ceiling a wrench in republican strategy
Friday 27 December 2024
Last Updated : GMT 09:40:38
Themuslimchronicle, themuslimchronicle

to get rid of the federal debt ceiling

Removing the debt ceiling a wrench in Republican strategy

Themuslimchronicle, themuslimchronicle

Themuslimchronicle, themuslimchronicleRemoving the debt ceiling a wrench in Republican strategy

US President Donald Trump
Washington - Muslimchronicle

President Donald Trump has thrown a wrench into the works of one of the Republicans' key tactics for pressuring Congress on spending, by proposing to get rid of the federal debt ceiling.

After announcing the surprise deal with Democrats last week to temporarily suspend the debt limit and extend the current budget for another three months until December 8, Trump said the idea of eliminating the debt ceiling altogether deserved to be debated.

"For many years, people have been talking about getting rid of debt ceiling altogether, and there are a lot of good reasons to do that," Trump told reporters. "It complicates things, it's really not necessary."

But that is provoking a strong reaction from stunned Republicans who use this powerful leverage over the government's borrowing authority in budget negotiations with the White House.

For the past 100 years, authorization to increase the debt ceiling has been the sole prerogative of the Congress. And while the debt is merely used to pay spending and obligations already approved by the legislature, it nevertheless is a bargaining chip used to pressure the ruling party for concessions on spending.

It also regularly reopens the political debate over the massive US debt, which has reached $20 trillion.

Until the mid-1990s, Congress routinely approved increases in the debt limit. But everything changed in 1995 under the presidency of Democrat Bill Clinton who battled the Republican-controlled Congress on many issues, including the budget.

- Tea Party pressure -

Since then, the recurring threat of the debt ceiling has regularly poisoned US administrations, especially under the presidency of Barack Obama, raising the specter of a government shutdown -- as happened in late 2013 -- or worse, a debt default.

"I think it would be good policy to get rid of it," Stan Veuger, an economist with the conservative American Enterprise Institute (AEI) told AFP.

But that will be difficult to do since Republicans will strongly oppose it.

"They like having some future leverage if they were in the opposition again," he said.

In addition, "politically it would put them in a very difficult position because it would make them look like they don't care about the debt," Veuger said, "especially after the way the Republicans have politicized the subject over the last few years."

In fact, using the debt limit to politicize the debate over government spending led to the creation of the very conservative Tea Party movement within the Republican party, which supplied many Trump supporters.

FreedomWorks, the organization that helped launch the Tea Party, immediately denounced the idea of ​​removing the debt limit.

"The debt ceiling is a good thing," FreedomWorks President Adam Brandon said. "Debates over the debt ceiling are moments when conservatives can successfully fight to reduce the size and scope of government."

- More effective tools -

The Republican Speaker of the House of Representatives, Paul Ryan, also blasted the idea.

"As imperfect as this tool is, I always see this as a good tool for fiscal discipline," Ryan told Fox News Radio.

But most economists say the debt ceiling is not an effective means to limit spending, and in fact leads to increased borrowing costs when Congress threatens to allow the US to default on its debt.

That was the case in 2011 when, for the first time in contemporary history the US lost its coveted AAA credit rating.

When interest rates on US debt rises because of the increased risk, "ultimately we as tax payers are paying," said Shai Akabas, of the Bipartisan Policy Center.

He said it is time for a bipartisan approach to find "other vehicles or tools, fiscal tools, that would be more effective and less risky" than the debt limit.

The debate will take months. Even after the new December 8 deadline for suspending the debt limit, the Treasury will be able to use "extraordinary" accounting measures to allow it to continue to finance the government until Spring 2018.

source: AFP

themuslimchronicle
themuslimchronicle

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

removing the debt ceiling a wrench in republican strategy removing the debt ceiling a wrench in republican strategy

 



Themuslimchronicle, themuslimchronicle

GMT 14:15 2017 Thursday ,31 August

Mohamed bin Zayed receives HCT delegation

GMT 07:29 2017 Thursday ,23 February

Kohli issues Starc warning to India's batsmen in Pune

GMT 09:38 2017 Friday ,11 August

At least 36 killed in China bus crash

GMT 06:36 2018 Wednesday ,24 January

World powers step up pressure on Syria, Russia

GMT 21:36 2011 Thursday ,12 May

Euro steadies against dollar

GMT 20:12 2011 Tuesday ,10 May

Qatar exchange up 1.42 %

GMT 08:37 2016 Thursday ,08 September

By alleged toxic bomb attacks in Aleppo

GMT 19:18 2011 Wednesday ,09 February

RiRi - love the way you smell

GMT 22:55 2017 Wednesday ,04 October

Trump says he has 'total confidence' in Tillerson

GMT 10:54 2015 Monday ,23 March

Simple chocolate button egg

GMT 16:37 2015 Saturday ,23 May

Classic lasagne

GMT 19:08 2017 Wednesday ,01 November

Libya coastguard rescues nearly 300 migrants at sea

GMT 04:42 2017 Wednesday ,30 August

Saudi Arabia says ready to welcome

GMT 13:01 2017 Thursday ,30 November

Streaking Cavs survive James' first career ejection

GMT 18:41 2016 Wednesday ,21 September

Prince Faisal congratulates king on Haj success

GMT 10:25 2017 Sunday ,24 September

Google looking to help news outlets win subscribers

GMT 11:30 2017 Tuesday ,28 November

Kenyatta vows to 'unite' Kenya after divisive poll

GMT 11:22 2011 Thursday ,01 December

Sony Vaio YB Series

GMT 09:37 2011 Thursday ,29 September

Amazon launches online bookstore in China

GMT 10:40 2011 Thursday ,06 October

A new website displays video clips

GMT 11:23 2014 Thursday ,01 May

Yoga can help keep expectant mothers stress free
Themuslimchronicle, themuslimchronicle
Themuslimchronicle, themuslimchronicle
 
 Themuslimchronicle Facebook,themuslimchronicle facebook  Themuslimchronicle Twitter,themuslimchronicle twitter Themuslimchronicle Rss,themuslimchronicle rss  Themuslimchronicle Youtube,themuslimchronicle youtube  Themuslimchronicle Youtube,themuslimchronicle youtube

Maintained and developed by Arabs Today Group SAL.
All rights reserved to Arab Today Media Group 2023 ©

Maintained and developed by Arabs Today Group SAL.
All rights reserved to Arab Today Media Group 2023 ©

muslimchronicle muslimchronicle muslimchronicle muslimchronicle
themuslimchronicle themuslimchronicle themuslimchronicle
themuslimchronicle
بناية النخيل - رأس النبع _ خلف السفارة الفرنسية _بيروت - لبنان
themuslimchronicle, themuslimchronicle, themuslimchronicle