As expected, the bill to increase the debt ceiling was passed by this nation’s legislators. In effect, it increased the borrowing limit from $14.3T to approximately $16.7T. Leaders from both sides of the isle worked round-the-clock to produce a last minute compromise meant to avert a shut down of the federal government. The pressure was palpable and intensified by a testimony from Federal Reserve Chairman Bernanke who said that if the limit is not increased the government will fail to pay 40% of its obligations including social security payments and the salary of our military personnel. Put in those words and offered by the preeminent expert in the field, the outcome was predictable.
There were contingency plans in the event the bill did not pass including dipping into three different federal employee funds. But like any form of debt it merely creates a bridge until the next budget crisis comes along. Many will agree the government is simply spending too much money. A default in any case would have been catastrophic. The effects of which nobody in Washington DC understood or was willing to risk. So, erring on the side of caution was the only solution that was possible. It gives the government more time to get the house in better financial order until the funding runs out before January of 2014.
HOUSE VOTE ROLL CALL
There were contingency plans in the event the bill did not pass including dipping into three different federal employee funds. But like any form of debt it merely creates a bridge until the next budget crisis comes along. Many will agree the government is simply spending too much money. A default in any case would have been catastrophic. The effects of which nobody in Washington DC understood or was willing to risk. So, erring on the side of caution was the only solution that was possible. It gives the government more time to get the house in better financial order until the funding runs out before January of 2014.
HOUSE VOTE ROLL CALL
