by Karl Stark | June 01, 2011
In what has become an ever-escalating game of chicken, the U.S. House on Tuesday night rejected by a 97-318 vote a proposal that would have raised the debt limit ceiling and prevented the United States from defaulting on debts it has already incurred. The Treasury Department is already taking emergency measures to extend the nation’s ability to meet its obligations through August 2, 2011, but that hasn’t prevented some in Congress from continuing the political theater.
Tuesday’s staged vote on the “clean” debt limit bill — meaning no policy or other changes in spending were included — was held explicitly so that it would fail. Said House Ways and Means Committee Chairman Dave Camp (R-MI), “this vote, a vote based on legislation I have introduced, will and must fail.”
Rather than move forward on a solution, Rep. Camp and his colleagues pulled a stunt to show that they’ll only pass a debt limit increase if it includes damaging cuts to Medicare, Medicaid, and Social Security, like those contained in Rep. Paul Ryan’s (R-WI) budget. These are the same lawmakers who insist that revenues not be part of any budget or deficit agreement.
The truth is, raising the debt ceiling is vital to the economic health of our country, and playing games with the debt ceiling couldn’t be more irresponsible. Standard and Poor’s has already warned that the U.S. could lose its ranking as the world’s safest economy if the limit is not raised, and increased risk would send interest rates on U.S. Treasury securities through the roof. And because these bonds are a benchmark for many other financial services and products, interest rates throughout the economy will skyrocket — on credit cards, mortgages, business and student loans, municipal bonds and more. Pension and retirement accounts are already being drained.
Failing to raise the debt ceiling would make it harder and more expensive for business owners to raise capital and increase employment. It would make it harder and more expensive for state and local governments to generate revenue. And it would make it harder and more expensive for families to get homes or send their children to college. That’s why AFSCME has been fighting to raise the debt ceiling. If Congress continues to play chicken with the debt limit, the nation’s economy will come home to roost.