Dems Propose Unlimited Debt

With Republicans demanding spending cuts in exchange for an increase in the federal debt limit and President Biden refusing to consider negotiating a compromise, House Democrats are proposing legislation that would eliminate any limit on the debt.

Rep. Bill Foster (D-Ill) argued that "if there were sufficient popular support for limiting how much the government can borrow voters wouldn't be electing so many Democrats. Rather than periodically raising the limit, I say we simply allow the government to borrow and spend as much as it wants to. The GOP's refusal to go along threatens the full faith and credit of the United States."

"What threatens the full faith and credit of this country is the Democrats' continued insistence on spending money we don't have," House Speaker Kevin McCarthy replied. "It took the country 225 years to accumulate the $9 trillion in debt that existed before Obama became president. Now, 15 years later this debt has more than tripled. We now pay more than $400 billion per year just paying the interest on this debt. We must constrain spending if we want to avoid bankruptcy."

Foster wanted to know "what's so bad about bankruptcy? In theory, creditors can seize your assets. But what use are the federal government's assets going to be to the people who bought government bonds? Their only sensible option would be to continue to deploy the property, buildings, armaments and so forth for the same purposes as they are currently used. They'll just be different hands. Most people won't know the difference."

McCarthy suggested that "there might be some profound differences. A lot of the federal debt is owned by foreign governments. China has a particularly large portfolio of US government bonds. Maybe these new bosses won't be the same as the old bosses."

In related news, the Congressional Budget Office has just reported that the Trump tax cuts of 2017 led to a growth boom that actually increased federal tax revenues by $1.5 trillion over the past five years. So, contrary to Democrats' claims, those tax cuts are not the cause of the soaring federal deficits and debt.

By John Semmens