All the wrangling over the original Fiscal Cliff was really just a warm-up for the fight that is brewing between the GOP and the Obama Administration about how to handle the debt ceiling. Sometime between mid-February and March, the U.S. is going to run out of money to pay its skyrocketing bills, unless lawmakers agree to allow the U.S. to raise its debt limit. The current debt limit is already at a historic high, but the country simply doesn’t raise nearly enough revenue to pay for its unchecked spending practices.
And while most economists agree that failing to raise the debt limit will have a negative impact on the fragile U.S. economy, one has to wonder how much longer the current game of extend and pretend can possibly go on. For the first time, Republican lawmakers will be in a position to leverage the debt ceiling to get real spending reductions from Democrats. Whether they have the conviction to force the issue remains to be seen, as does just how far the President will allow the partisan posturing to go before he’s forced to step in and make promises that he can’t possibly keep.
In a forum in which he took questions from social media, Ben Bernanke seemed to be firmly behind President Obama’s position that failing to raise the debt ceiling would be catastrophic for the U.S. economy. House Speaker John Boehner seemed unfazed by Bernanke’s support for the President’s ideas, saying, "The American people do not support raising the debt ceiling without reducing government spending at the same time." It would appear that, at some point, something’s gotta give.
And while most economists agree that failing to raise the debt limit will have a negative impact on the fragile U.S. economy, one has to wonder how much longer the current game of extend and pretend can possibly go on. For the first time, Republican lawmakers will be in a position to leverage the debt ceiling to get real spending reductions from Democrats. Whether they have the conviction to force the issue remains to be seen, as does just how far the President will allow the partisan posturing to go before he’s forced to step in and make promises that he can’t possibly keep.
In a forum in which he took questions from social media, Ben Bernanke seemed to be firmly behind President Obama’s position that failing to raise the debt ceiling would be catastrophic for the U.S. economy. House Speaker John Boehner seemed unfazed by Bernanke’s support for the President’s ideas, saying, "The American people do not support raising the debt ceiling without reducing government spending at the same time." It would appear that, at some point, something’s gotta give.