Last year, Americans were plagued with uncertainty as the so-called “fiscal cliff” approached. No budget was approved at the end of 2012, a failed negotiation that resulted in seven months (and counting) of sequestration, spending cuts, and strain on the U.S. economy. Government austerity (reduction) restricted growth. All in all, it’s been a tough year, and most Americans are ready to find some solutions and move on to better times.
While last year’s uncertainty was what caused dread in many, this year it’s the certainty that’s cause for worry. On October 17th, the United States will hit the debt ceiling and, essentially, run out of money to pay its bills.
“What we dealt with earlier was really a slope more than a cliff,” said KKR businessman Kenneth Mehlman in January of this year. “But the debt ceiling is an actual cliff. The government running out of money is an actual cliff.”
It’s a cliff that we’re driving toward at a reckless speed, and if the past few weeks of government shutdown are any indication of how party negotiations will go, we’ll go straight over. Short-term solutions were implemented earlier this spring, but what we really need at this point are some long-term, bipartisan solutions that keep in mind what’s best for the people.
As an American citizen, it feels a bit like being locked in the back seat of a car while your driver and another play “Chicken,” driving at top speed toward each other and waiting for the other to veer away at the last second.
Once (and if) Congress votes to reopen the government and begin serious negotiations, the main issues at hand will be the approval of a budget and whether or not to raise the debt ceiling. While the term “debt ceiling” may seem like it’s describing the country’s actual debt, it’s not. Raising the debt ceiling would simply allow the government to pay for spending that’s already been authorized by Congress. It’s putting the signature on the check that’s already been written.
If the debt ceiling is not raised, the U.S. will default for the first time in over 200 years, and much of the economic progress we’ve gained will likely be lost. Unless both parties sit down, soon, and start negotiating, the U.S. will have even more serious issues on its plate.