Will America’s Debt Ceiling Fight Lead to a Default?

Skepticism mounts regarding whether Congress and the Executive branch can hammer out an agreement to raise the nation’s debt ceiling before June 1, 2023. After every meeting between House Speaker McCarthy and President Biden and with every day that passes, tensions rise in a drama designed to hold Americans hostage to Deep State bureaucrats’ unquenchable thirst to spend the American people’s money on often ineffective social programs. Recent initiatives include the Biden Administration’s effort to bail out federal student loan recipients even though only one-third of Americans possess a college degree from a four-year institution.

As the debt deadline approaches, many hyperbolic economic forecasters assert that America’s debt ceiling fight could sink the economy. Treasury Secretary Janet Yellen and others warn of a “calamity.” But since U.S. debt rose by nearly 400% over the past 20 years, it begs the question: Where were these forecasters during the past two decades of calamitous spending?

After all, America’s debt ceiling crisis has been fueled by a spending binge that has resulted in persistent budget deficits that have seen the federal government routinely spend more than it receives in tax receipts. Budget deficits require the United States government to borrow more and more money. Hence the national debt accumulates over time. In the last half-century, there have been only a handful of years when the government did not spend more than it collected in taxes. In recent years, spending has soared to combat the COVID-19 virus from China and the wars in Afghanistan, Iraq, and now Ukraine. These spending chickens have come home to roost, even though it seems clear that such efforts have primarily benefited big pharmaceutical companies and American defense contractors.

The most important federal programs include mandatory spending programs such as Social Security and Medicare. Together these two mandatory expenditures make up 63% of the federal budget. Other budgetary items make up discretionary spending. Given the massive size of mandatory spending programs, this narrows the scope for Congress and the Executive branch to cut the overall budget. This is an essential point because evidence mounts that the ongoing debt-ceiling fight comes down to a choice between spending cuts, a spending freeze, or, if some Democrats have their way, a spending increase in the next fiscal year.

Even though Treasury Secretary Yellen ignores her role in fueling the federal government’s spending spree, she now asserts that the clock is ticking. She claims the $31.4 trillion debt ceiling has been reached, leaving the government without cash as of June 1, 2023. Whether the June 1, 2023, deadline is actual or aspirational, it is clear that the United States needs to rein in spending. But since both Democrats and Republicans enjoy spending other people’s money, that is a tricky proposition.

Nevertheless, conservative Members of Congress have engaged in a good-faith fight to cut spending. The American people need to take an active role in this fight by fighting additional spending initiatives each and every day. Otherwise, we will continue to lurch from one debt-ceiling fight to another, thus putting the nation’s and our children’s future at risk.