4 Myths Regarding the Supposed U.S. Debt Ceiling Crisis (+4K Views)

Here are some myths about the debt ceiling and the debate about raising it.

By Lorimer Wilson, Managing Editor of munKNEE.com – Your KEY to making money!

1. Failure to pass the debt-ceiling increase means defaulting on our debts

FALSE: The U.S. Treasury currently takes in more than enough revenue to pay both the interest and the principal on the debts we currently owe but, that being said, there wouldn’t be enough money left over to pay for everything else.

2. Failure to pass the debt-ceiling increase on time would be unprecedented

FALSE: While it’s true Congress has never refused to raise the debt ceiling it has frequently taken its time doing so. In 1985, Congress waited nearly 3 months, in 1995 Congress waited 4.5 months and, in 2002, Congress delayed raising the debt ceiling for 3 months. In none of those cases did the world end. It won’t this time, either.

3. Any debt-ceiling increase must be without conditions 

False:  Conditions are far from unprecedented. There have been numerous amendments and conditions attached to debt-ceiling bills throughout the years.

4. Raising the debt ceiling is just about paying for spending that’s already occurred

False: It is not about paying only for spending that has already been authorized but for spending on programs the government is planning to spend on and there is nothing wrong with forcing government not to spend money that it is planning on spending.

Conclusion

Republicans are not doing a very good job explaining why the debt ceiling shouldn’t be raised. Instead they need to dispel the prevailing myths – the fear-mongering by the Democrats – about a supposed debt-ceiling crisis.