January 4, 2011
A new decade, a new milestone. The U.S. Treasury reported the end of year debt numbers, and low and behold, the government has added another trillion during the last six months, for a whopping total of $14,025,215,218,708.52. In the last four months, the debt increased by $600 billion, or $150 billion a month. At that rate, the federal government will reach the debt ceiling of $14.294 trillion in less than two months, possibly at the same time the president delivers his budget.
But if the Republican-controlled House decides to follow the lead of the Tea Party Caucus and vote against raising the debt limit, President Obama could be delivering his budget recommendations in the dark as the government shuts down. On Sunday, Austan Goolsbee, chairman of The White House Counsel of Economic Advisers, fired a warning shot to Republicans on ABC’s This Week:
"This is not a game. You know, the debt ceiling is not…is not something to toy with … If we hit the debt ceiling, that's essentially defaulting on our obligations, which is totally unprecedented in American history. The impact on the economy would be catastrophic. I mean, that would be a worse financial economic crisis than anything we saw in 2008.
“As I say, that's not a game. I don't see why anybody's talking about playing chicken with the debt ceiling.
"If we get to the point where you've damaged the full faith and credit of the United States, that would be the first default in history caused purely by insanity."
Fifteen years ago, when Bill Clinton was president and Newt Gingrich was Speaker of the House, the government did shut down, but reached a balanced budget deal in time to raise the then-$4.9 trillion debt ceiling and avoid defaulting on government loans. According to a Time magazine/CNN poll, Americans rejected the shutdown strategy and Clinton’s approval ratings rose.
Today, Rep. Michele Bachmann, R-Minn., who heads the Republican Tea Party Caucus, echoes the sentiments of the 1996 House Budget Committee Chairman, John Kasich. "The shutdown was all about how do you pressure an executive to do what an executive doesn't want to do?" Kasich said. "And frankly, I'm not sure what other ways there are to get him to do things."