Maggie's Farm

The problem with that is that they would be holding creditors hostage. Having already appropriated the money, having committed to pay, not raising the default would lead to a credit default—America's broken promise.

Really? Why do you say this?

The Congress is not proposing to repudiate past debts, and incoming tax receipts well allow for interest payments. Rollover refinancing of maturities are similarly permitted.
The House is merely saying that, in the absence of a budget, no further growth in debt should occur. The "broken promise", to the extant one exists, is to those receiving entitlement payments from the government. Any lender or supllier to the government knows, because it is printed in big block letters on every note, that future repayments are subject to appropriation risk. Future Congress' may not choose to appropriate amounts necessary to pay future bills.

Heck, I've had that exact situation n my business several times over the last couple fo years with Illinois and California. Those two states weren't able to pay me amounts they owed, and issued my company what amounts to IOU's instead.

No "broken promise" here, and certainly no credit default. That's just factually incorrect.

You aren't gettting it: ALL amounts "promised" by government as future payments are subject to appropriation risk.

Every time a Congress "promisses" to pay in a different fiscal year the promise is not a fully binding promise to pay-- in every single instance it is up to the Congress then in session to appropriate the money.

Creditors can decide not to lend more money to that government and vendors can decide not sell to that same government, if money owed to them is not appropriated and paid.

Similarly, those expecting entitlement payments can expect to have to go elsewhere if they are not paid. Simple fact.

When bondholders come to redeem their U.S. bonds, the government has to come up with the money. If they don't redeem those bonds when they are due, then the U.S. is in default. Meanwhile, the government is required by law to continue spending money on its various programs.


Now it looks as if you're talking about something completely different than raising the debt ceiling. You are talking about printing money, and there is no limit on how much money the Fed can print. It's entirely up to them.

If a bondholder comes to redeem his or her bond for cash at maturity the Fed prints money to pay them. No debt ceiling increase is necessary for that to happen, or even enters into the process.

If you are talking instead about rolling over debt obligations into new bonds, there is no need- again- to raise the debt ceiling in order to do that.

The only reason to raise the debt ceiling is to pay for government spending not paid for by current tax receipts or cash reserves. In practice that really only refers to recipients of entitlement money, since tax receipts easily cover defense, other departments and interest on debt.

Those people receiving government payments need to understand that those "promises" are entirely subject to Congress appropriating money every year to pay them, and the debt markets willingness to fund the new debt should Congress approve it.

The Constitution requires this for very good reasons, and no Congress can (with very limited exceptions) make financial promises that future Congress' are obligated to honor.

Are you intentionally missing the point, or am I just not getting through?

Why all the hate for Les Mis? Because it teaches that redemption and transcendence over earthly troubles are only possible through faith. To the secular left, it's a scandalous show.