Congress Should’ve Killed the Debt Limit a Long Time Ago. Here’s What it Should Do Now.

Congress Should’ve Killed the Debt Limit a Long Time Ago. Here’s What it Should Do Now.

CNN Business (Opinion)

October 12, 2021

Recent Congressional drama over the debt ceiling has sparked calls for changing the century-old federal financing process. The current situation “sets a legal maximum of the nation’s debt, and once the limit is reached, the government can only spend what it receives in revenues,” says Mark Zandi, Chief Economist of Moody’s Analytics. In theory, setting a limit on the national debt should prompt lawmakers to act more fiscally responsible. “That’s not how it has worked. Instead, often after much drama, lawmakers raise the limit just in time to avoid a default but without making difficult choices on taxes or spending.” The least painful path for addressing the issue might be making an exception to the Senate’s filibuster rule regarding the debt limit. “Given that the debt limit is so counterproductive that even threatening to breach it does economic damage, lawmakers should significantly lower the political bar necessary to increase it,” Zandi says.

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