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August 03, 2011

Putting the Debt Ceiling Genie Back in the Bottle

"Can the Debt Ceiling Genie Be Put Back in the Bottle?" the New York Times asks as part of today's fusillade against the bill which ended the debt ceiling "crisis". They disapprovingly quote Senator Mitch McConnell: "Never again will any president, from either party, be allowed to raise the debt ceiling without being held accountable for it by the American people and without having to engage in the kind of debate we've just come through." Apparently they think that the level of national debt is not a fit subject for debate in a democracy.

The article suggests that a constitutional amendment may be necessary to assure that future presidents can raise the debt ceiling at will. They fear that otherwise there will be an epidemic of "hostage-taking".

However, there's a much simpler way of assuring no repeats of this sort of drama and it doesn't take a constitutional amendment. All future Congresses have to do is include a debt limit increase (if needed) with each budget they pass; both will or won't become law at the same time. The American people will benefit by knowing exactly how much new debt they are being asked to take on to fund whatever new benefits they are being promised or whatever new bailouts or subsidies are being proposed.

Of course, in order to implement this idea, Congress would actually have to pass a budget. That's something Congress hasn't managed to do for the last two sessions. Lack of a budget has left us with nowhere to debate the deficit level except for continuing resolutions and bills to increase the debt ceiling. As President Obama says "It shouldn't take the risk of default, the risk of economic catastrophe, to get folks in this town to work together and do their jobs." But it did!

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