The debt celing soap opera explained so simply that even a member of Congress can understand it

[Kevin K.]

Best thing I've seen on this ridiculous drama, courtesy of Cullen Roche:

https://disciplinefunds.com/2023/05/12/ ... t-ceiling/

[boglerdude]

They do this every year right. Anything new this time. IIRC some years ago they went further and closed national parks

[yankees60]

https://disciplinefunds.com/2023/05/12/ ... t-ceiling/

Easing Concerns Over the Debt Ceiling
I’ve spent a lot of time in the last few weeks talking to investors trying to ease concerns over the debt ceiling and default. This piece will provide a brief description of how I view all of this, the potential scenarios and why I think you shouldn’t panic over the debt ceiling politics.

I’ve explained the ridiculous nature of the debt “ceiling” before, but here’s a review:

Congress establishes a “debt ceiling”, a fake upper limit on how much national debt we can issue.
Then Congress approves legislation that will require new debt in the future.
That new legislation necessarily causes a breach of the debt ceiling at some point in the future.
Congress then forgets that they passed legislation requiring new debt and they refuse to pass legislation raising the debt limit.
Members of Congress spend a few weeks grandstanding and pretending to care about fiscal responsibility.
Then the debt ceiling gets raised because we all know defaulting would be the stupidest self inflicted economic wound of all time.
Rinse, wash, repeat.
This is obviously a ridiculous sequence of events. I’ve compared it to eating a huge meal and then tying a knot in your stomach and then threatening yourself with death if your stomach digests the food. This is crazy. You don’t impose a limit on how much food you eat AFTER you eat the food. The time for fiscal and dietary responsibility is BEFORE you eat.

Ignoring the operational irrationality of this “limit”, let’s discuss actual default potential.

[whatchamacallit]

Warren Mosler's take on the debt ceiling that was recorded on May 1st


https://youtu.be/e-VC5Dfd4_A

I believe there were some fans of him here in the past.

[yankees60]

https://www.usatoday.com/story/opinion/ ... 177113007/

US debt ceiling crisis can be explained in three words: Marjorie Taylor Greene

OK, it's not 100% fair to blame America hurling toward an economic crisis solely on the Georgia congresswoman, but she and her fellow MAGA lawmakers are certainly at the root of the US's dilemma.

Rex Huppke
USA TODAY

[boglerdude]

yeah its that simple. Relatedly, r/ "news" has devolved into leftist rage-porn. https://old.reddit.com/r/news/top/?sort=top&t=week

[D1984]

yeah its that simple. Relatedly, r/ "news" has devolved into leftist rage-porn. https://old.reddit.com/r/news/top/?sort=top&t=week

OK, so how is the threatened default not the GOP's fault? This whole debacle only seems to happen when we have Republican control of one or both houses and we have a Democratic President.

Assuming only the two parties (since AFAIK we have no Greens, Libertarians, Reform Party members, etc in either house of Congress and the few independents we do have caucus with one of the two major parties) the combinations are thus as follows:

Republicans control both houses of Congress and Republicans control the Presidency,

Republicans control one house of Congress, Democrats control the other one, and Republicans control the Presidency,

Democrats control both houses of Congress and Democrats control the Presidency,

Democrats control one house of Congress, Republicans control the other one, and Democrats control the Presidency

Republicans control both houses of Congress and Democrats control the Presidency,

Democrats control both houses of Congress and Republicans control the Presidency

How come if "bothsidesism" is correct and thus the Republicans are not the only ones to blame--which you seem to be implying is the case--we never seem to have the threat of default used as a extortion tactic unless it is a matter of the Republicans being the party in charge of one or both houses of Congress but at the same time not the Presidency? When we have unified GOP control there is no threat of default; when we have unified Democratic control there is no threat of default, when we have Democrats controlling both houses of Congress but facing a Republican Presidency there is no threat of default, when we have mixed control of Congress (each party controlling one house but not the other) but a Republican President there is no threat of default.....the only time we have the threat of default on the national debt being used as if it were a legitimate negotiating tactic is when a GOP house and/or GOP Senate faces a Democratic President.

Only one party acts like this come debt ceiling raise time (i.e. "even though we don't have majority control of the government at all we demand you give us our way or else we default on the debt and the economy gets it" )......and it isn't the Democrats.

[Xan]

As much as I generally agree with GOP priorities over Dem ones, and with the idea of a government that spends less, i have to agree with D1984 that the current standoff is the GOP's fault and they should back down. The time to take a stand for less spending is when the spending statutes are being debated, not when the bill comes due.

[boglerdude]

Government needs to be shrunk/obstructed/gridlocked by any means necessary. If thats not what "republicans" are doing here, then its bad.

edit1: if you want to expand only the good and smart aspects of government, that negotiation begins with admitting the flagrant civil rights violations of 2020-2023

[D1984]

Government needs to be shrunk/obstructed/gridlocked by any means necessary. If thats not what "republicans" are doing here, then its bad.

Why? If you look at places with larger governments vs places with high HDI it seems that there is a correlation. This doesn't mean that having bigger government causes the higher HDI and high standards of living, but it certainly shows that it isn't inimical to it.

edit1: if you want to expand only the good and smart aspects of government, that negotiation begins with admitting the flagrant civil rights violations of 2020-2023

Aww.....poor widdle baby was asked to wear a mask and to stay at home as much as possible for a little while unless absolutely necessary--in order to, you know, hamper the spread of a potentially deadly disease--and now it thinks this was the worst oppression in all of human history.

Oh the oppression! Oh the horror! Even worse than the Holocaust or slavery! (BTW I am being totally sarcastic in case you couldn't tell).

Seriously, stop being such a snowflake. We didn't even have real actual lockdowns (like China had) or even heavy travel restrictions like Australia had.

Being told to wear a mask, stay at home, and being encouraged to get a vaccine are pretty small potatoes on the "oppression and tyranny" scale when you look at all of human history (or indeed even when you look at American history).

[boglerdude]

> didn't have lockdowns like China/Straya

Not yet, thats why line gets drawn here

> encouraged

No jab no job. No job no $ for housing and food

[jalanlong]

Government needs to be shrunk/obstructed/gridlocked by any means necessary. If thats not what "republicans" are doing here, then its bad.

Why? If you look at places with larger governments vs places with high HDI it seems that there is a correlation. This doesn't mean that having bigger government causes the higher HDI and high standards of living, but it certainly shows that it isn't inimical to it.

edit1: if you want to expand only the good and smart aspects of government, that negotiation begins with admitting the flagrant civil rights violations of 2020-2023

Aww.....poor widdle baby was asked to wear a mask and to stay at home as much as possible for a little while unless absolutely necessary--in order to, you know, hamper the spread of a potentially deadly disease--and now it thinks this was the worst oppression in all of human history.

Oh the oppression! Oh the horror! Even worse than the Holocaust or slavery! (BTW I am being totally sarcastic in case you couldn't tell).

Seriously, stop being such a snowflake. We didn't even have real actual lockdowns (like China had) or even heavy travel restrictions like Australia had.

Being told to wear a mask, stay at home, and being encouraged to get a vaccine are pretty small potatoes on the "oppression and tyranny" scale when you look at all of human history (or indeed even when you look at American history).

So I am to measure all future transgressions by how they compare to The Holocaust or slavery?

Covid was a virus, not a disease. Look up the difference. But every virus is “potentially deadly.” So why don’t lockdowns continue indefinitely? I mean if it saves one life right?

[Xan]

I thought the "d" in "Covid" stood for "disease". Isn't Covid-19 the disease caused by the SARS-CoV-2 virus?

[yankees60]

I thought the "d" in "Covid" stood for "disease". Isn't Covid-19 the disease caused by the SARS-CoV-2 virus?

As usual ... you are correct!

https://www.goodrx.com/conditions/covid ... SnippetTab

What Does COVID-19 Stand For?

COVID-19 is short for “coronavirus disease of 2019.”

[boglerdude]

> why don’t lockdowns continue indefinitely? I mean if it saves one life right?

Why not, what do you actually need "freedom" for? Pandemic + climate restrictions and most will know its BS, but will be happy to get monopoly money and watch netflix.

Its what we deserve. The "based" Youtube commenters that questioned lockdown are still backing Trump. Martial law happened on his watch. How can he even win if elections are rigged and his lawsuits went nowhere. Trump will split the Right and we'll make a "great leap forward" toward merging with the CCP.

Edit1 https://old.reddit.com/r/LockdownSkepti ... own_on_uk/

[DogBreath]

Edit1 https://old.reddit.com/r/LockdownSkepti ... own_on_uk/

Okay, that's just scary that they are even discussing that in 2023.

[Hal]

Interesting interview => https://www.youtube.com/watch?v=2afXagEgRQw

00:00 Introduction
00:28 Current State of Affairs in Washington
02:30 Government Accounting Trickery
05:08 Debt Ceiling and Defaulting on the Debt
10:32 Holding the Population Hostage
14:07 Constitutional Right to More Gov't Debt
21:51 The Missing Connection between Spending & Borrowing
33:55 Practical ways of Reducing the Debt
38:12 Ethics of Defaulting on the Debt
43:12 Hard Truth of Gov't Default

[barrett]

Thanks for posting that conversation, Hal. Very interesting as it deals with reality and not drama. And, to channel my inner Vinny, I may watch it again at some point.

[yankees60]

Thanks for posting that conversation, Hal. Very interesting as it deals with reality and not drama. And, to channel my inner Vinny, I may watch it again at some point.

Thanks for the homage. However, to do it correctly you have to start listening to it again as soon as you finished listening to it the first time around.