Assessment: Raising the debt ceiling is presented as a moral choice. Do it, or you favor poverty and “calamity.” But here’s the problem with Yellen’s position—and the prodeficit position in general: she’s not actually offering a choice between pain now or pain never. It’s only a choice between pain now or even more pain in the future.
Misses Institute: The US is in the midst of yet another “debate” over the debt ceiling. In the twenty-first century, this is a ritual that Washington politicos and journalists go through every few years when the prospect of default and government shutdown is used as a way to hold Americans hostage until they cave to a debt-ceiling hike. I won’t bore you with the details of which politicians are voting against a higher debt ceiling this time around. Outside a tiny handful of principled eccentrics of the Ron Paul variety, virtually everyone in Washington favors more deficit spending. The fact that the leadership from one of the parties currently pretends to oppose higher debt levels tells us nothing about what the regime really wants.
“The rich rule over the poor, and the borrower is slave to the lender.” Proverbs 22:7 NIV
What it wants, of course, is sky-high spending, forever, and it wants to borrow huge amounts—at rock-bottom interest rates—to do it. A default—brought about by a stable debt ceiling—would complicate that goal. A failure to hike the debt would also limit the power of the regime, so we can expect most everyone inside the Beltway to be deeply opposed.
