Economics History Politics

Why Raising the Debt Limit is a Bad Idea

On Friday, the US Treasury Department did its best to hide a little news story about the US debt. On Thursday, our debt somehow surged $328 Billion, the highest ever one day jump. Not only did the debt climb by an insane amount on Thursday, but that climb broke another record – it led to the highest total ever for the US debt.

We are now over $17 Trillion in debt.

That’s $17,000,000,000,000.00

That’s a lot of zeroes.

At this point some of you may be glazing over. I think that’s what the average American does when the slick-haired news guys starts talking about our national debt. “It’s already so BIG… what’s a few more dollars?” I get that thinking, I really do. How bad can our debt be if they’ll let us have $17 Trillion dollars of debt? But there are negative effects, and we are starting to see and feel them.

During the Obama administration, our credit rating took a hit. We lost our stellar rating that we’d kept even through the Great Depression. That makes borrowing even more expensive – which means our debt is adding up even faster. With the debt climbing, the Central Bank (or the Fed) is looking for ways to try to minimize the impact of our economic problems. (I personally think this is a bad idea and the Fed should not be trying to influence the market, but that is a rant for another time.) When the Central Bank tries to “help,” they do it by influencing the interest rates of loans. How do they do that? They print more money, in an effort to keep interest rates low. The problem is that this leads to inflation, which means your money is not worth as much as you think it is – and you should be noticing by now. Have you seen the climbing price of bread, milk, gas and other things? That’s not just the market talking… that is a direct effect of the games the Fed plays with interest rates – they are making our money less valuable.

So our increasing debt makes doing business more expensive, and it drives down the value of our money.

Do you realize the chain effect down the line? It means that you haven’t saved as much as you thought for retirement. It means that costs for basic necessities will be climbing, making it harder for poor families to get by. It means that the “gap” between rich and poor that the liberals are always crying about will actually get worse. There are even greater implications having to do with the value of the dollar on the global market and our place as the center of the economic and trading world… but that’s better left for another time. The basic point is that raising the debt limit is a bad idea all the way around.

To make this as simple as possible, you should really just watch this clip. It’s well worth the 3 minutes it will take to watch.

Get it?

 

The views expressed in this opinion article are solely those of their author and are not necessarily either shared or endorsed by EagleRising.com


About the author

Onan Coca

Onan is the Editor-in-Chief at Liberty Alliance media group. He's also the managing editor at Eaglerising.com, Constitution.com and the managing partner at iPatriot.com. You can read more of his writing at Eagle Rising.
Onan is a graduate of Liberty University (2003) and earned his M.Ed. at Western Governors University in 2012. Onan lives in Atlanta with his wife and their three wonderful children.

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