On May 1, U.S. Treasury Secretary Janet Yellen notified Congress that the Treasury Department could run out of cash on hand and would have to take even more “extraordinary measures” than simple emergency borrowing.
That comes as soon as June 1 and as late as early August, depending on the amount of payments remitted to the government before June 15 by taxpayers.
With a divided government, normally Americans would expect a deal of some sort between the Republican House and the Democrat-controlled Senate and White House. Polls show that Americans are solidly on the side of Republicans, in wanting to reduce spending and hit the brakes on borrowing. They feel the effects of runaway inflation and understand that federal borrowing is the obvious cause.
Federal spending has increased from $5.1 trillion in 2019 to over $6.3 trillion in 2022. That’s over a 23.5% increase, much of it to fund Green New Deal priorities of the Democrats, who are largely in charge of the direction of the federal government.
The federal budget has also grown from 21% to 25% of gross domestic product in three years, and now stands at over 120% of GDP, greater than even during the Great Depression. Interest payments borne by Americans are set to exceed $1 trillion a year.
The current debt-to-GDP ratio is troubling, ratio of the public debt to the country’s gross domestic product, is troubling. The higher the debt-to-GDP ratio, the less likely the country will pay back the debt, leading to a risk of default, which could lead to one of two outcomes: Dramatically increased inflation or extreme austerity measures.
The government’s debt is now 129% of GDP, as of the end of 2022, according to the Office of Management and Budget in the White House.
“Debt-to-GDP ratios above 77% can hinder economic growth and (in some cases) place a country at risk of defaulting on its debts, which could wreak havoc on its economy and financial markets,” writes World Economic Review.
The warning bells started in January, when the Treasury Department slammed into the $31.4 trillion debt ceiling set by Congress. Janet Yellen’s Treasury employed emergency borrowing authority to pay for government operations and pay for entitlements.
Former Republican congressional candidate Nick Begich shared his thoughts: “The concept of automatically raising the debt ceiling without debate is nothing more than a convenient escape from fiscal responsibility. It paves the way for unchecked government spending, burdening future generations with the weight of our irresponsibility.”
In a letter signed with other Democrats, Rep. Mary Peltola said that failure to raise the debt limit would prevent the federal government from meeting its legal obligations, including Social Security and Medicare benefits, military salaries, and tax refunds.
That’s dodging the real issue, said Begich.
“We must meet our obligations and we will. Averting a short-term crisis by plunging ourselves further into long-term debt is not a solution. It’s time we stop kicking the can down the road and start addressing the root cause of our financial problems — excessive spending,” he said.
As this debt ceiling showdown continues, voices like Begich’s are calling for fiscal sanity. “We must restore fiscal responsibility to Washington. That begins with a serious, responsible conversation about our national debt, not bypassing the debate once again,” he said.
As usual, Mary is clueless what she’s talking about.
IF we default, which will be on Biden’s head, all monies made must go to service said debt. Anything left over my go to “discretionary” spending.
This means we will be forced to face our reckless spending habit and act accordingly. AFTER Congress uses every sleight of hand available to pay off its pork commitments.
Mary is smart enough, as all good grifters are, to know someone blinks quickly.
Any and all monies not paid will be paid in arrears to not lose democrat voters.
Odds are the Democrats will blink this time. The GOP knows they will be blamed anyways and have nothing to lose. The left could face a revolt from its moderate wing wanting to hold on to seats.
But never, ever, underestimate the GOPs ability to F things up, badly.
Welcome to the Greater Depression, and Happy Mother’s Day.
It’s easy for Begich to make a claim/statement he’ll never have to put a vote behind.
Peltola knows zilch about budgets.
Congressman Nick Begich. 2024.
Gawd, please no.
He’s a 2 time, 3rd place loser.
He comes from the most liberal political family in Alaska – the BEGICH’s.
He’s is 100% responsible for the Peltola victory.
Time for another booster, Julia…
Exactly!!
Go away DoneWithIt. We don’t worship the ground Sarah Palin walks on around here.
Very childish response there DWY…
Just because DomeWithIt does not like Begich does not mean a single thing about Palin, or any other candidate.
The Palins are the most RINO conservatives. Sarah gave us Sean Parnell, and Mary Petola. Nick Begich didn’t grow up with his liberal relatives. He was raised in Arizona by his conservative grandparents. He’s been a member of the Young Republican since grade school.
Agree!????
Pelota clearly doesn’t balance her own checkbook much if this is how she believes the world works.. Sorry Mary, we the people are tired of funding corrupt politicians like you and their agenda. The Government can go broke for all I care!
I’m with you, Daisy Mae. The faster we bottom out, the sooner we can claw our way to the top! I know a gentleman who’s been knocked to a barroom floor more than a few times, and I’ve never heard him complain about picking himself off a “well-patronized” floor! The “trip” to the bottom can’t be all that bad!
Edit: “I know a gentleman who’s been knocked to many a barroom floor, and I have never heard him complain about having to pick himself up off any of the filthy floors! So the “trip” to the bottom can’t be all that bad!”
Yes agree with Begich. Also it Will Not affect Social Security or Military that is the Democratic threat!! We need to cut the garbage out if spending not only federally but State also
Vehicular needs to run again. The Sarah and Mary tag team kept a conservative out of office. We need to fix that mistake.
As if “diverging (truly) makes all the difference…” – with apologies.
Well I vote to take Mary’s paycheck’s and give them to the IRS. She seams willing to spend our money how about she spend hers first. Come on Mary show us your serious.
Blab,Blab,Blad were all being played.
“……….The higher the debt-to-GDP ratio, the less likely the country will pay back the debt, leading to a risk of default, which could lead to one of two outcomes: Dramatically increased inflation or extreme austerity measures……….”
Even addressing this economic cataclysm before default is recognized will require either ‘extreme austerity measures’ or prolonged, less-than-extreme austerity measures, neither of which this society will accept voluntarily. This is why we’re here, and this is why our future is guaranteed: this must be addressed with non-voluntary measures. There are several possibilities, but none of them will be pleasant.
This is why Begich will be the next one in office and Peltola will be a 1 term mistake!!
So he and the rest of his clan can get on the gravy train, too??
Yes!
So Begich says it’s time to be honest about spending, eh? What a hell of a notion that is, as if honesty were seasonal. When did politicians–red, blue, or some other rainbow hue–ever speak the truth?
We need to get rid of rigged choice voting so that we can elect candidates that at least have some common sense.
Her votes indicate that VPSO’s should be defunded, illegal immigrants should be welcome in the villages, covid fraud is ok and fiscal responsibility is underrated. Big government good! Legal taxpayers should be responsible for 6-7 million people to cross our borders without signing the guest book.
Yes and I can’t wait to see the villages with these changes. They already are full of crime poverty and high prices so give them more Mary.
Peltola may claim to have been a 14 year old boat captain but doesn’t look like she learned much. While Begich is saying we need to patch the holes, Peltola wants to put more water into a sinking ship. Let’s get real, folks. We’re not just facing a debt ceiling showdown, we’re on the brink of a disaster. Hopefully Alaska will back the guy with a plan, not the one excitedly handing out deck chairs on the Titanic.
Begich, the intern who stabbed Don Young in the back, and ensured a split Republican vote by finishing in third place every time. Go away.
Shut it all down and start over again from scratch. This time, fund ONLY those government handouts – er… “programs” – that we really need, and dump the rest. Sell off all the government office buildings to pay down the national debt. Then, teach all the laid-off bureaucrats how to program.
Sure, Americans are solidly on the side of Republicans in wanting to reduce spending (depending on who’s doing the polling I’m sure), but if you ask them what should be cut, I doubt you’d get a cogent answer. Cut Social Security? How about Medicaid/Medicare? Farm subsidies? Corporate bailouts? Freddie Mac/Fanny Mae? No, none of those things. Face it, Americans love socialism, including Republicans, and there is no way any of them want anything cut that would actually reduce the debt.
Typical leftist.
Goes straight to threatening Social Security. Pick the thing that everyone will oppose cuts to as your first sacrificial lamb.
.
What would I cut? Oh… here is a partial list:
Department of Health and Human Services: 20% cut = $540B
HUD: 50% cut = $126B savings.
Department of Education: 50% cut = $87B savings
Department of Energy: 100% cut = $160B savings. (that department has never actually done what they were created to do. Total failure.)
US Agency for Global Media: 100% cut = $1B in savings
National Endowment for Humanities: 100% cut = $252M savings
National Endowment for the Arts: 100% cut = $227M savings
Denali Commission: 100% cut = $126M saved.
Kennedy Center: 100% cut = $85M saved
African Development Foundation: 100% cut = $74M saved
And the list goes on.
Important to note, that is just at the Department level. If I were to dig into each of these and look at specific programs/agencies I could find a LOT more to cut.
.
But, nope… You have to threaten the most sacrosanct of the Federal Programs, ignoring the billions the Federal Government spends on stuff that does not benefit the US population as a whole.
So your entire list amounts to about $3B out of a Federal budget of about $6.2 trillion in 2023 or about .05%. Wow, that’s some savings. I put Social Security first because, at $1.2 trillion in FY22, it is by far the largest entitlement in the Federal budget and one that I would think any person really wanting to get rid of debt would go after first, especially since its such a socialist moneybag, but I guess its sacrosanct to you. Typical conservative hypocrite.
So, my bad, I was reading some of your “B’s” as “M’s” so with that in mind your total is closer to around a little more than $ 1 trillion, which is still only about 16% of the FY23 Federal budget. So, if you cut both Social Security and ALL of the DHHS (which houses the agency that manages Medicaid and Medicare) you’re looking at cutting out closer to $ 3 trillion (“health” is about $914B in spending and Medicare is about $755B). How about that? That’s pretty much 50% of Federal expenditures right there. If you’re a true fiscal conservative, why is either SS or Medicaid/Medicare a sacred cow? I’ll tell you why, its because Americans are secretly in love with Socialism. I don’t have a problem with this, but you might as well be honest about it.
As for the other programs, lets discuss, maybe there are other things we can cut if you’re willing to join me in getting rid of the above.
Wow, you math sucks.
Do you even understand the difference between mandatory and discretionary spending?
Apparently not.
.
Besides, if I cut 16% of the Federal Spending, that is a massive deficit reduction.
.
Finally, you still insist on going after the programs that will hurt the public most, instead of actually cutting the luxury items that no one will really miss.
I am sure the Dems will figure a way to tax and spend their way outa this mess. They always have in the past.
Got it backwards there Andy.
The Democrats spend first. Then they raise taxes to cover the luxury item the just bought.
Isnt the gift giving to corrupt Ukranians overdue. They definitely need another bailout package of cash to keep Burisma afloat.
So I guess you’re OK with Putin’s thuggery and invasion of another sovereign country.
It’s not our war. It’s a European problem.
Since you’re so concerned about invasions, are you against the invasion at the southern border going on for almost 3 years now?
People said the same thing about WWII; it was seen as Europe’s War…until it wasn’t.
Wonderful non-sequitur as well but I’ll answer the question. Yes, as someone who grew up in Texas I’ve long been concerned with this countries lack of a cohesive border policy. Thanks for asking.
I am good with it.
Since when does the US have a dog in the spats between other countries? Why should we care?
I am old enough to remember protests because the US got involved in foreign wars, and the protestors were all leftists. But, I guess that changes when the President is a democrat. Then wars are OK.
Clearly you’re good with Russian thuggery, I get it. I guess you were OK with Saddam Hussein’s Caligula crime family as well and would have been perfectly content for him to have remained in power, invading other countries, using WMD’s, etc, correct? That was an example where the US got involved with a “spat between other countries” and that was under two different GOP Presidents and I supported both invasions. I’m sure you were out in the streets protesting against that, correct?
Hussian did not bother me one bit.
And, if the Russians keep their thuggery on their side of the ocean, why should I care?
I don’t believe one stinking word that a democrat says…Begich
Nick,the Michael Corleone of the Begich Crime Family
The Democrats in the Begich family backed Peltola. Doesn’t seem like Nick Begich and the rest of the Begich family are on the same political page but we wouldn’t want the facts get in the way of your feelings Chuck!
I met Nick Begich while he was door knocking in my neighborhood in North Pole. We had a great conversation and he really knew his facts. I hope he runs in ‘24!
They kept Michael out of “family” businesstoo,until they needed him when he came home from the war guess you never saw those movies, so you don’t understand the reference
Peltola only understands the Western Alaska economic model: Get a check from the government. Quickly spend the money. Hold hand out and demand another check from the government. Repeat forever.
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