Summary: Should we raise the national debt limit to accommodate more trillion-dollar deficits? In Washington, it's taken for granted that we should and will. But a lot of fiscal conservatives have got the crazy idea in their heads that any debt increase should be accompanied by something we haven't seen in years: a budget. An actual plan to balance the budget and stop accumulating debt. President Obama is having none of it. Yesterday morning, he conducted a press conference clearly intended to put fiscal conservatives on the defensive in the next round of the Great Debt Ceiling Debate. His various claims and assertions, taken together, are so misleading, that only a line-by-line rebuttal can do them justice. Here goes. Assertion: We will soon hit the debt ceiling Now, [a] congressionally imposed deadline coming up is the so-called debt ceiling ... Response: Correct. On August 2, 2011, President Obama signed into law a $2,100,000,000,000 ($2.1 trillion) increase in the government's statutory debt limit. Roughly 518 days later, the money ran out and Treasury hit the $16,394,000,000,000 [$16.394 trillion] ceiling on its borrowing authority. Because of massive overspending, America is on an unsustainable fiscal path. The government technically came up to its current statutory borrowing limit -- of some $16,400,000,000,000 [$16.4 trillion] -- at the end of December. The Treasury, however, has the ability to do a bit of juggling with certain government funds and so keep us under the ceiling for a couple of months. Uncle Sam is currently spending about $100,000,000,000 [$100 billion] a month more than he takes in. Treasury's "extraordinary measures" to avoid hitting the ceiling are said to buy about $200,000,000,000 [$200 billion] worth -- or two months -- of headroom. Experts predict we will run out of headroom sometime in the latter half of February. At that point, the government won't be able to continue borrowing. Since the government currently raises only about 60 percent of the funds it needs to cover its expenses, this will mean an immediate 40 percent reduction in federal outlays (or more precisely, a postponement of 40 percent of federal outlays, as prioritized by the president). The remedy for this cash-flow crunch will come when Congress either raises the debt limit, increases taxes, or reduces spending, or some combination. Note Mr. Obama's use of the term "congressionally imposed" to describe the debt ceiling. He is impatient with the existence of a debt ceiling, and with fiscal conservatives' efforts to use it to secure spending restraint. During the recent Fiscal Cliff negotiations, he reportedly asked that Congress delegate to the President the power to raise the debt ceiling unilaterally without limit. That would be both unconstitutional and unwise. The US Constitution grants to Congress, and only Congress, the power of the purse, that is, the authority to fund the federal government, including the power to “lay and collect taxes,” the power to "pay the debts and provide for the common defence and general welfare of the United States," and to “borrow money on the credit of the United States” (US Constitution, Article I, section 8, clauses 1 and 2). From 1789 to 1917, when Congress needed to borrow, it would pass a law authorizing the Treasury Secretary to conduct a particular bond issue of a certain kind and amount. In 1917, Congress provided the President with a limited delegation of borrowing authority. In 1939, it went further and created the first statutory aggregate debt limit to pay obligations authorized by Congress. Since then, Congress has raised the statutory debt limit dozens of times. But constitutionally the power to borrow remains with Congress, not the President. And it should remain there. Hence, the necessity of "congressionally imposed deadlines." Assertion: Before 2011, increasing the debt ceiling was routine and uncontroversial ... [the debt ceiling is] something most Amer
