Should the debt limit for the US exist?

joecavalry

Yes, Congress has to start taking more fiscal responsibly. The debt ceiling allows the government to take more control of their debt.

Nope

The debt limit fails to keep US dept low because Congress decides the taxes and what to spend the US money on. If more money is being spent then taxes can pay for they get in debt. Rather then trying not to hit the debt limit the debt limit has always been raised. If the debt limit was exceeded the government would have trouble paying for serves that have already been done. This would cause a loss of trust in the US dollar which so much of the world depends on. This is why the debt limit is always raised. What is the point of having a debt limit that is never fallowed. It is not effective at controlling US dept.

whiteflame

Setting effective limits on government spending is certainly necessary, though I don't think that the debt limit is an effective way to do it for two reasons. One, it gets raised regularly which defeats the purpose. Limits can certainly be adjusted, and this should be no different, but if a limit is constantly adjusted, it no longer function as a limit. The debt limit is effectively a guideline when it can be moved around so easily, which gets into the second problem. The one way that the debt limit has functioned as more than a guideline is that it comes with a pretty strong threat of harm should we ever exceed it. The problem with that is, rather than disincentivize spending, it's become a regular tool for each party to use as leverage to get what they want. Particularly in divisive political times such as this, we need to recognize that the debt ceiling should not be a political tool that either party can wield with impunity, particularly when the effects of exceeding it do so much harm to the US has a whole. 

I'm honestly not sure what would work best in its place, though certainly something should replace the debt ceiling. 

Fredsnephew

What is debt?

Debt is just a conceptuality. A number game that governs our lives.

Who is the U.S actually indebted to?

MayCaesar

Any debt is a result of an investment. The state debt in particular is the state borrowing resources to invest it in the economy in a way that, hopefully, will allow it to pay the debt back and still be left with the positive net income. The size of the debt depends heavily on the requirements of the current economical state and the course of action chosen by the state, hence artificially limiting it does not seem reasonable.

Almost all economists agree that the positive debt is a boon for the economy: it means that at the moment the economy has more resources available than in the conditions of zero debt, hence allowing for a much faster economical grow. The size of the debt is what is being regularly debated, but the consensus is that the optimal size of the debt approximately equals the GDP of the market.

Fredsnephew

MayCaesar said:

Any debt is a result of an investment. The state debt in particular is the state borrowing resources to invest it in the economy in a way that, hopefully, will allow it to pay the debt back and still be left with the positive net income. The size of the debt depends heavily on the requirements of the current economical state and the course of action chosen by the state, hence artificially limiting it does not seem reasonable.

Almost all economists agree that the positive debt is a boon for the economy: it means that at the moment the economy has more resources available than in the conditions of zero debt, hence allowing for a much faster economical grow. The size of the debt is what is being regularly debated, but the consensus is that the optimal size of the debt approximately equals the GDP of the market.

Yes, but who is the U.S. actually indebted to?

MayCaesar

Fredsnephew said:

MayCaesar said:

Any debt is a result of an investment. The state debt in particular is the state borrowing resources to invest it in the economy in a way that, hopefully, will allow it to pay the debt back and still be left with the positive net income. The size of the debt depends heavily on the requirements of the current economical state and the course of action chosen by the state, hence artificially limiting it does not seem reasonable.

Almost all economists agree that the positive debt is a boon for the economy: it means that at the moment the economy has more resources available than in the conditions of zero debt, hence allowing for a much faster economical grow. The size of the debt is what is being regularly debated, but the consensus is that the optimal size of the debt approximately equals the GDP of the market.

Yes, but who is the U.S. actually indebted to?

Well, there is domestic debt and external debt. When we say that the US is indebted to someone, we imply that the government has taken loans it has not yet repaid. In case of the domestic debt, those loans are taken from private US companies, and in case of the external debt they are taken from foreign governments or private companies.