Okay, let's get serious about this debt ceiling business. Just what is it and how does it REALLY affect us Americans?
First of all, let's look at the debt, $16.3 trillion dollars. OMG! Huge isn't it. However, let's not blow our minds just yet. Owing money is not a biggie if you can pay it back. There probably isn't an American out there who has an income that doesn't have debt [Mortgage, car pmt., etc.]. We don't like it, but we like to have things, so we are willing to place ourselves in debt in order to have our toys and et cetera. What we are doing is indebting our future to have things today. Pretty simple, right? No big mystery here, we do this every single month, day and year.
The National Debt is somewhat the same only on a Macro level. The National Debt is money we owe for things we needed today. Some of those things are various social programs, military need and infrastructure needs. To whom does America owe that money? Well, mostly the government owes the money to us...the American Taxpayer. We gave the money to the government in the form of taxes to pay for things we needed, like Medicare, Medicaid, Social Security, Social Security Disability and other programs that we feel we need in this country. A huge part of the debt is Military. We spend an inordinate amount to government to protect us from foreign hostiles. We also spend a whole bunch on programs that help our infrastructure [road/bridges/etc.] And we spent a bunch of money on agricultural programs.
Totaled up, our debt equals $16.3 trillion dollars we have borrowed to provide these essentials for our population. We agreed to do this.
The biggest raiser of the debt ceiling was Ronald Reagan who raised it 17 times. The beginning of this type of borrowing began with the Civil War believe it or not. We are a warrior country and we borrow tons of money in order to conduct that business -- and I mean business because it is -- of war. If we were not in any war anywhere, we would save billions of dollars. However, we would also have a large majority of Americans on welfare and unemployed because we don't have the infrastructure jobs to support the soldiers who would flood the system.
The beginning of today's Debt Ceiling problems actually began with Ronald Reagan. He came into office by campaigning on the scare tactic that America was becoming a second class military country and the Communist Menace [who Reagan called The Evil Empire] would land on our shores or send missiles over Canada and destroy our major cities before we could react. He said we needed more and more military equipment to stop the Evil Empire including an outer space system to shoot down enemy missiles. The so-called Cold War was a huge hit to the debt ceiling. It caused Reagan to raise it more times that any other president in history.
All this info sounds mucho scary right? Oh my, oh my, what shall we do? Well, rather than being a Chicken Little, we need to look at the debt rationally.
There are no modern countries in the world who do not have debt. The European collective nations have huge debt due to the Euro being devalued. Great Brittan has a huge national debt [Over a trillion 'pounds' -- .6255 exchange rate]. Their debt would be about 1.6 trillion dollars.
Again, it doesn't matter how much you owe; how much can you pay back? America is an exceedingly rich nation and is able to pay back huge amounts of loaned money.
Our big worry. China will own us cause we owe them money. Bosh! That'll never happen so stop worrying about it right now. They cannot repossess us if we don't pay our loans back. That only happens on a micro level, i.e., when the bank comes and takes back your car for not paying for it. The National Debt is a different animal entirely. You cannot repossess a country.
So, if you cannot repossess a country, then why do we other countries loan money to countries and why do they loan money to us? Political reasons mostly. Good public relations is another reason. Finally, humanitarian reasons.
What would be the blow-back if America didn't increase the Debt Ceiling? The world has a credit rating system. America used to have a AAA credit rating, but now it has been lowered to AA status. Mainly because of the the Congress of the United States' inability to create a budget. This congress has to be the worst in history when it comes to getting important business done [Called the Do-Nothing Congress]. Because of the Republican filibustering, we have created a debt monster and a lowered credit rating.
If America defaulted on its loans, it would lower our credit rating and would it would be almost impossible for us to do worldwide business. It would drive us into a depression like 1929...maybe worse. We couldn't run credit to ship or have things shipped to us. Overseas goods would dry up. No more Nissans, Hondas. No more dolls. No more anything foreign made. Go into your closet and look at the tags on your dresses and shirts...see how many are made overseas. Even many things we eat are sent to us from overseas.
So, is it necessary to raise the debt ceiling? Oh yeah. Absolutely.
Why would congress not approve it? Why in the world would the play politics with something so important? Ask The Re-pugni-can Party. For the past 4 years I have been shaking my head at their antics. The Tea Party 66-year old lady who was on Social Security and Medicare and against a National Health System. The Congressman who said 'Legitimate Rape." The Junior Congressman who said he hosted kings and queens at his Washington office. The Republican Candidate who said he had binders full of women. The Republican Senate who has 1 African American in their midst.
I dropped completely out of the Republican party during Nixon's reign. That's right, I said Reign. That's what Nixon thought it was. "If the President says it's legal, then it's legal." He actually said that! That was before the Watergate mess and Nixon's shame. The Republican Party has been going downhill ever since. The Great Republican God, Ronnie Reagan was anything but. George Dubya was a disaster. And now we have to deal with a congress that's living in the 1950's. They actually said that the only business they needed to do was make Obama a one-term president; they failed, and the country suffered.
There is a new congress now with new members. Will it change? The Debt Ceiling will tell us just where their heads are at.