Congress on notice: U.S. to hit the debt limit in mid-October

Remember, the other day, when President Obama so righteously declared to the young people the audience that “we don’t have an urgent deficit crisis”?

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We’ll still have to make some modifications when it comes to our long-term entitlement programs so that they’re here for young people here when they’re ready for retirement, but we don’t have an urgent deficit crisis. The only crisis we have is one that’s manufactured in Washington, and it’s ideological. And the basic notion is, is that we shouldn’t be helping people get health care and we shouldn’t be helping kids who can’t help themselves and whose parents are underresourced, we shouldn’t be helping them get a leg up.

Nutshell version: ‘Yes, we kinda’-sorta’ have a long-term fiscal disaster on our hands with our entitlement programs, although I plan to contribute precisely nothing else beyond ObamaCare to the solution — and nah, you young people especially don’t have any reason to worry about our running deficit or ObamaCare at all! Besides, those Republican squares live to thwart me personally, and your only two choices here are for either more government spending, or more poverty and human misery. Done and done.’

The more honest assessment of the situation, of course, is that we’ve shot way past the point where all of this debt and deficit spending is coming at the opportunity cost of a robust economy and more widespread prosperity, and that failure to address the problem in a substantive way now is only going to mean accelerating toward still more consequences in the not-so-distant future.

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I merely mention all this again because the budget battle is going to be a forefront issue starting pretty soon here, and the above is almost certainly an example of the sort of intellectually hollow rhetoric to which we’ll be regularly treated. Whether it turns into another down-to-the-wire battle for political concessions or is casually shuffled through as routine business is still an open question, via the WSJ:

The U.S. Treasury Department said Monday it would hit its borrowing limit in mid-October and could no longer be able to pay all its bills soon after that time.

The timeline could step up pressure on Congress to decide whether to raise the debt ceiling in the coming weeks. Lawmakers remain split over whether to simply increase the government’s borrowing authority or to insist that any increase be combined with a large deficit-reduction package.

Treasury Secretary Jacob Lew told Congress on Monday that after mid-October, the government would be able to make payments “with only the cash we have on hand on any given day.” In a letter to House Speaker John Boehner (R., Ohio), Mr. Lew projected the Treasury would have roughly $50 billion on hand by mid-October, and said this level “would be insufficient to cover net expenditures for an extended period of time.”

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Stephen Moore 8:30 AM | December 15, 2024
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