Please explain why not raising the debt limit is automatically associated with default on the debt?
If the debt limited is not authorized, the US still collects enough revenue each month to cover 65% of what it wants to spend on. Servicing the debt only accounts for 6% of spending. Then there's the 14th Amendment. It says that the debt must be attended to above all other spending. There is no reason why servicing the debt can't be covered. If fact, it would be breaking the law not too. Besides, like all Congressional tussles, it would be temporary. It's never a permanent situation.
- Warren TLv 78 years agoFavorite Answer
It isn't unless Obama makes it so because the government takes in about $150 billion each month and the interest on the national debt is $30 billion.
- who WAS #1?Lv 78 years ago
It is kind of a moot point because the debt ceiling will always be raised.
Not so much because we have to borrow more money but because Federal borrowing through the Federal Reserve banksters is now money comes into existence. Money is debt, your dollar bill says "note" right on it.
It is not just the government needing more money, it is more like the Federal Reserve has to always increase the money supply. The system is designed for steady growth. Paying off debt (whether it is the government or you at your bank) destroys money, thanks to fractional reserve banking.
If you deposit a dollar, it becomes 10. If you pay off a dollar debt, you just destroyed $10.
Scale this up to Federal government level. They always have to borrow more in order for the Federal Reserve to create more money.
And that's assuming the system is running 'honestly'. Check this out:
- xpatinasiaLv 78 years ago
"Servicing the debt only accounts for 6% of spending."
Since you are a conservative, you can't do simple math.
- Frank BarnwellLv 46 years ago
3.9 0n 20 - 40 Loans Based upon Area Developments, and Governmental Futures, divided by term life Investments 100,000 will yield 200,000 Annually; Accrued, and combined w/ Various Corporate in vexations. ...0413/2015