According to the Cato Institute, from 1962 to 1995, the federal government spent more than they took in. It wasn’t until 1995 when the Republicans took control of the U.S. House under the leadership of Newt Gringrich as Speaker that a balanced budget was passed. Since 2001, the budget has not been close to being balanced, partially because of the war on terror, but mostly because most of the politicos( in both parties) in Washington lack the courage to say no to entitlement programs.
The “national debt” is the amount of money owed by the government to holders of U.S. debt instruments(Treasury notes, bills, bonds, and Inflation-Protected Securities) China owns the most of any foreign government, around 800 billion as of June 2009. Most of the US “national debt” (65%) is owned to taxpayers. Government takes money from trust funds like Social Security and leaves an I.O.U. and uses the money in budgeting.
The Second Liberty Bond Act of 1917 established a statutory limit on federal debt. Up until that time, Congress had to approve each debt issuance separately. The debt limit provided the U.S. Treasury with more flexibility and leeway in the administration of debt, but it also allowed for government to mortgage you and your descendents future income.
When the federal stimulus package was passed in February, the federal debt ceiling was raised to a record 12.104 trillion. Now just six months later, the Obama administration has asked that the debt level be raised to 13 trillion- double what it was just six years ago.
Back in 2006, President Bush was attacked by then Senator Obama on the floor of the Senate for asking for an increase in the debt ceiling. “Washington is shifting the burden of bad choices today onto the backs of our children and grandchildren,” “America has a debt problem and a failure of leadership,” Obama said. This is probably the ONLY thing he has said I agree with. But back in 2006, Obama joined his Democratic colleagues in voting as a bloc against raising the debt ceiling. Now Obama is now asking for his second “debt ceiling” increase in six months.
The “national debt” is now projected to double under the Obama presidency to a level close to 97% of Gross Domestic Product. The national debt has increased by one third in the first nine months of Obama’s administration.
Both the White House and the Congressional Budget Office last month said that they expect the “national debt” to increase by another $9 trillion over the next decade. Should the Senate follow the House's lead and set the new debt limit at $13 trillion, lawmakers would probably have to raise the limit again next year, when the Obama administration expects to run a $1.5 trillion deficit. The “deficit” in this year’s budget is projected to be 1.3 trillion dollars.
A ceiling has a purpose- it is to stop things from going too high. The debt ceiling should be made of iron and not toilet paper. Elected officials should be working overtime to find ways to stay under the debt ceiling by laying off government workers and cutting non-essential government programs. Passing a higher debt ceiling weakens the dollar and prolongs our economic woes. At some point, somebody in Washington has to start making some hard decisions before we go bankrupt as a country.
Ignoring the “debt ceiling” and deficit spending are just two of the reasons that two million average citizens marched on Washington last Saturday. Fed up with a government that spends more than it takes it and rewards irresponsibility has awakened a sleeping giant- the American people. If they stay charged up and engaged through November of 2010, change could be coming to Washington, but not the kind Obama campaigned for.