By Alejandro Freixes, CCNN Head Writer
Ever since the US government “shut down” last Tuesday, Democrats and Republicans have dug their heels in, refusing to negotiate (give a little, take a little) on Obamacare.
A second problem is approaching swiftly as well, because the US has to raise its “debt ceiling” if it wants to borrow more money to pay off its bills. If this ceiling isn’t raised, then there’s going to be worldwide economic damage, as the US is a huge cog in the wheel of money internationally.
Despite several talks between President Barack Obama and House Speaker John Boehner, no solution seems to be in sight. The Republican-led half of Congress, the House of Representatives, just continues battling the Democrat-led half of Congress, the Senate. Both sides claim to be willing to negotiate, but not over the pieces of the law most important to them, and so no compromise takes place.
Jack Lew, the US Treasury Secretary (who helps manage the government’s money), is very worried that Congress won’t do its job. He recently spoke with CNN’s Candy Crowley, and explained, “On the 17th we run out of our ability to borrow, and Congress is playing with fire if they don’t extend the debt limit.” He’s also concerned about the effects it will have on other countries, because, “We are the strongest, most important economy in the world.”
So, what’s the deal with the debt ceiling? Basically, if the US doesn’t raise the limit on how much money it’s allowed to borrow, then it won’t be able to pay a lot of programs in the country that depend on the government. The reason some Republican’s don’t want to raise it, is because they want the government to cut its expenses first, rather than just continuing to borrow.
As for most Democrats and moderate (less extreme) Republicans, they know the US has raised its debt ceilings for decades without any major negative effects. It’s just part of the economic game. Lew looks back on history, observing, “We’ve never gotten to this point. We’ve never gotten to the point where the United States government has operated without the ability to borrow. It’s very dangerous. It’s reckless, because the reality is, there are no good choices if we run out of borrowing capacity and we run out of cash.” How long ago did this happen last time? 1789! If it does happen, Lew blames it on “a political decision,” meaning it’d be the fault of the political parties looking out for themselves rather than the people who elected them.
Lew believes that the president is willing to negotiate, expressing, “The president has been, is, and will always be looking for that way to negotiate to find the sensible middle ground. He did it in 2011, he did it last year, he did it this year in his budget where he put forward tough policies.” However, Senator Ted Cruz, whose 21-hour filibuster speech tried to delay Obamacare recently, says the Republicans plan on using the debt ceiling for “leverage” – using something to pressure another person or group into doing something.
Cruz, who also spoke to CNN’s Candy Crowley, said, “Since 1978, we raised the debt ceiling 58 times. Twenty times Congress attached very specific… requirements, many of the most significant spending restraints. So the president’s demand to jack up the nation’s credit card with no limits, no constraints – it’s not reasonable.” Basically, he says it’s nothing new for Congress to make spending cut demands in exchange for raising the debt ceiling.
Featured image of US Secretary of the Treasury courtesy of US Department of the Treasury on Flickr. Image and video of John Boehner courtesy of John Boehner on YouTube.