A few random thoughts on the debt ceiling and the current debate:
1) Let's start with what I think a reasonable ultimate goal should be. Take a look at the chart below:Chart from USGovernmentSpending.com website
OK- pretty simple chart. The debt (not deficit, but actual debt) as a % of the GDP. And right now, we're higher than at any point except during WWII, when the country was legitimately fighting for it's existence. We don't have that type of crisis at the moment.
I consider myself a long-term optimist. Don't much with the basics, and the short term will take care of itself. I figure that as long as the government debt is stable, it's manageable.
But at the moment, the debt as a % is both higher than the GDP- and still growing. And demographically, our population is getting older- which means more money to be spent on Medicare, Medicaid, Social Security.
I think the goal should be to pick a reasonable range of what % of actual debt we should be spending, and tailor our expenses around that goal. I'm not sure what % would be low enough to prevent any worries about defaults and interest rate payments (which I think are generally a waste of money- we get nothing for the money spent on interest- but may be needed). Maybe 60%- maybe 80%- maybe even 90%. But right now, it's over 100%, it's growing, and there seems to be no desire to actually put that money under control.
2) Take care of the long term fundamentals and the short-term should solve itself. If you have a household budget where you're paying off your mortgage consistently and not being reckless, even a short-term obstacle (say, a massive car repair bill) is an annoyance rather than a disaster. It's the same way with government debt- we have income and spending, and need to watch both to keep the budget from getting out of control.
3) I don't have a problem with the budget deal discussed here
as long as the 'trigger' actually causes the cuts. But I have to admit- I've seen this dance before. From to the budget deal
that caused George H.W. Bush to break his "No New Taxes Pledge" to early 2011's sham
... the spending cuts never seem to materialize. I've gotten very cynical about this, and if the spending cuts don't actually happen, then this fight was for nothing.
4) If this debt ceiling bill actually works, then we should be reducing the deficit- which means we'll be moving away from the debt ceiling and we won't have to deal with this again. Right?
5) Unlike some other Conservatives, I've never liked a Balanced Budget Amendment. There are times when a crisis is serious enough that you have to say "Screw the bills- we gotta pay for this NOW". But I still think a Term Limit Bill would do a lot more to help get the budget under control. A constant turnover of politicians would bring in more people who actually write budgets with a better understanding of revenues and spending.
6) If this deal doesn't work- if the spending cuts never come, and there's some workaround on the trigger- well, I give up. At this point, I don't think anyone will control the federal debt until we actually get some sort of crisis. Might as well actually trigger it today- because the longer it's delayed, the worse it will be.