Northwoods UU Issues Resource Links: DEFICIT, DEBT CEILING, AND THE FEDERAL BUDGET

QUICK LINKS:

DEBT CEILING

BACKGROUND / EXPLAINERS

Why we have a debt ceiling, and why this trip to the brink may be different
by Ron Elving, NPR.org | January 21, 20235:01 AM ET|
QUOTE FROM THE ABOVE ARTICLE:
"A key point to remember: raising the debt limit is not about spending in the future. It is about meeting the cost of existing commitments the government has already made. The time to cut back future spending is in the budget and appropriation processes the government goes each year in anticipation of the next. That is where the future is determined. The debt limit is about owning up to the past, paying the bill that has arrived for previous purchases and commitments."

EXPLAINER: What Is the Debt Ceiling and Why Does It Matter? The cap on how much the government can borrow has become a political football, but the consequences are very real.
By Tim Smart, U.S. News.com | January 19, 2023 7:25 P.M. |

The U.S. hit the debt ceiling — here’s what that means for your money
By Ryan Emey, CNBC.com | January 21, 2023 9:00 AM EST |
QUOTE FROM THE ABOVE ARTICLE:
"The U.S. government funds much of its spending through debt, which is issued by the Treasury. The current limit is $31.4 trillion.
Raising this limit would allow the government to borrow more to cover spending already approved by Congress. Failure to raise the ceiling would mean the government would eventually fail to pay back its debts, including interest payments on Treasury bonds — technically putting the U.S. government in default."

Backgrounder: What Happens When the U.S. Hits Its Debt Ceiling? As the U.S. government grapples with another deadline to increase its debt limit, economists warn that a possible default could have disastrous economic consequences.
By Noah Berman, Council on Foreign Relations.org | January 20, 2023 2:00 PM EST |
QUOTE FROM ABOVE ARTICLE:
"What is the debt ceiling?
Created by Congress in 1917, the debt limit, or ceiling, sets the maximum amount of outstanding federal debt the U.S. government can incur. As of January 2023, the total national debt and the debt ceiling both stand at $31.4 trillion."

Lots of sound and fury on US debt, but not a crisis — yet
By Josh Boak, Associated Press News.com | January 27, 2023 |
QUOTE FROM ABOVE ARTICLE:
"The national debt is not the yearly deficit, the amount the government outspends its tax revenues. If the government cuts spending or raises taxes, it can trim the deficit and run a surplus, something that last happened in 2001. Less borrowing over time can contain and even reduce the cumulative debt.... But the debt challenge will keep unfolding over time, meaning that choices may become more severe as the costs of Social Security, Medicare and Medicaid increasingly outstrip tax revenues."

NEWS ARTICLES ON THIS TOPIC

Alexandria Ocasio-Cortez overestimates Trump tax cuts’ contribution to national debt
By Louis Jacobson, Politifact.com | February 1, 2023 |
QUOTE FROM ABOVE ARTICLE:
"On Jan. 26, a reporter asked Ocasio-Cortez, "Democrats have been in charge the past two years. Do you think Democrats have spent too much money?"

She replied, "I think the largest contributor to the debt ceiling, or to our deficit, has been the Trump tax cuts."

The Trump tax cuts, officially known as the Tax Cuts and Jobs Act, has been a major factor in ballooning the federal debt, because the reduction in revenues has made it harder for the nation to cover its spending commitments. However, contrary to what Ocasio-Cortez said, the bill that Trump signed has not been the largest factor in increasing the debt, whether you use the debt or annual deficits as the measure.

Politifact ruled the claim FALSE.

5 women, immense power: Can they keep US from fiscal brink?
By Mary Clare Jalonick and Seung Min Kim, Associated Press | January 27, 2023 |
PLUS the current Secretary of the Treasury is Janet Yellen, another woman.

Kevin McCarthy's math problem
By Caitlin Owens, Axios.com | January 25, 2023 |
QUOTE FROM ABOVE ARTICLE:
"House Republicans have said they’ll refuse to raise the debt ceiling unless it’s accompanied by reductions in federal spending. But the party appears to be deeply divided as to what programs should be on the chopping block."

Senate GOP to McCarthy: Debt fight is all yours A handful of Republican senators helped twice raise the nation's borrowing ceiling in 2021. They're less willing to step into the breach this time.
By Burgess Everett, Politico.com | January 23, 2023 7:14 PM EST |

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