Thursday, September 8, 2011

What Debt Ceiling?

The president, we’re told, will propose $300 billion in new stimulus tomorrow night — half of it tax cuts, half of it new spending. What he proposes to do about the debt ceiling, we don’t know... but he’ll need to propose something quick.
Under the Obama-Boehner deal signed into law Aug. 2, the ceiling was raised an initial $400 billion — sort of an appetizer before the feast.
Thus, the current ceiling is $14.694 trillion. As of the close of business last Friday, the most recent figures available, the total debt subject to that limit is nearly $14.650 trillion.
Hmmm... Only $45 billion in wiggle room. In a $3.8 trillion budget, the ceiling will likely come into play next week. Treasury would have to start borrowing from federal pension funds and performing other accounting trickery.
The president can ask to bump up the ceiling another $500 billion. In a convoluted procedure that would make the Founders pound their heads against a brick wall, Congress can choose to either do nothing and allow the ceiling to increase... or take a vote on whether to reject said increase.
And some people thought the Aug. 2 agreement actually settled something.

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