Congress is bracing itself for another debt-ceiling debate. It’s difficult not to view it as another “kicking the can down the road” exercise. And, as we all know, there are times when the road ends. What do you do then?
Federal Fiscal Sustainability Foundation Board Member and Professor Emeritus of Economics at the University of Colorado, Barry Poulson, gives us some hope – a potential solution to resolving the debt crisis and a way to secure a strong financial future for the next generation in the recently published article that follows:
Failure to lift the debt ceiling would have resulted in debt default. A default occurs when the Treasury does not have enough money to pay for obligations it has already incurred. The crisis was averted when Biden and congressional leaders agreed to lift the debt ceiling as part of a budget agreement. What the president and Congress agreed to do is to kick the can down the road. The debt limit was suspended for two years until 2025.
Congress continues to struggle to live with that budget agreement, and the legislators have yet to agree on most appropriations and face a September 30 deadline. If they miss the deadline, the government will shut down.
We must avert a constitutional crisis over debt. If the controversy over the debt limit reaches the Supreme Court, it is not clear how the justices would decide the question, or if they would even decide to hear the case. Moreover, it is unclear if elected officials or anyone else would have standing under Article III of the Constitution. The court may be reluctant to decide a case involving proceedings between the executive and legislative branches of government.
There is a solution to this crisis.