The Debt Ceiling is Not the Issue. The Debt is.


The Small Investor

As the shutdown continues into a second week, the public is starting to see the debt ceiling issue on the horizon.  Unfortunately the facts have become clouded in half-truths and distortions created for political reasons.  The goal is to get the public scared and thereby gain leverage.  Here are the facts:

Fact 1:  The first fact is that there is no reason for the US Government to default if the debt ceiling is not raised.  Current payments on the debt are about 1/8th of what the government brings in each year.  It is possible a debt payment could be missed if the government spends the money on other things (which may have already been done), causing a cash flow problem.  But this is kind of like a family spending all of the income from a month on a vacation before paying all the credit card bills.  There is plenty of…

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