Opinion: Speaker Kevin McCarthy Got the Votes on Debt Ceiling Bill. So What?
2023-06-01
The bill raising the debt ceiling, effectively allowing the federal government to keep “its door open” until at least January 1, 2025, is being touted as a victory for Speaker of the House Kevin McCarthy.
Is it?
Considering the consequences to our country’s credit rating and resulting disaster if we defaulted how much of a victory is this?
Judging by the quotes and press releases from fellow Republicans “everyone” said this couldn’t be done. “Everyone,” said the Speaker would fail in his efforts to hold the government financially accountable. All Democrats believed that he couldn’t get the job done.
Get the idea that somebody is on the campaign trail already?
Avoiding the government going off a financial cliff and calling it a victory is a little like a baseball manager claiming his team’s relief pitchers did a bang-up job by holding the opposing team to only 15 runs! in a game.
What exactly is the standard this victory is being compared to?
Now Americans are accustomed to having debts, so it’s not a complete surprise that there aren’t protests going on around the country. Outside of banks, car dealerships, major sports stadiums, and of course anywhere in Washington, DC. We are awash in car loans, boat loans, credit card debt, mortgages, and so on.
As a country, we are used to running in the red - meaning having more debt than savings.
The average credit card debt for Americans is about $7900 depending on the source.
But compared to the national debt, Americans are doing okay.
Currently, the US debt ceiling stands at $31.4 trillion and will be raised in order to keep the wheels of government moving forward.
To put this into perspective with that amount in cash we would be able to purchase:
· 341,000,000 luxury cars valued at $100,000 each
· or 7,850,000,000,000 Big Macs. Bon Appetite!
Debts, like anything done in excess, become numbing after a while. We stop looking at it for what it is.
When adults are fighting to pay off $100K or more in student loans, can we fault them when after a few years they don’t even remember writing the check each month? Just ask anyone in their 50s or 60s who just made their last payment.
Americans are used to their government running in the red as well. Earn a million, spend a billion, the rest being made up on credit extended. In effect history’s largest credit card balance that is being paid off every year in the same way as any other debt.
But not all debt is created equal.
Money spent on infrastructure - the rebuilding of bridges, highways, airports, and the like is essential to maintain a thriving economy.
Money spent supporting a graying population who helped support the country for over 40 years - Baby Boomers - seems only fair. Spending close to $1 trillion per year on defense, when cost overruns are a large percentage of that - the jury is out on that one.
The Lockheed Martin F-35 Lighting II is already $163 Billion over budget and seven years behind schedule.
When is enough really enough?
Should Speaker Kevin McCarthy be taking victory laps around the Capital after “winning” the vote in the house?
Senate approval awaits the bill but is likely to pass and then be signed by the President, who was closely involved in the negotiations.
If all goes well, we will have collectively dodged a bullet this year.
But the gun is still loaded and cocked and waiting for January 2025 to be held in someone else’s hand.
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