The US debt ceiling is a legislative limit on the total amount of debt that the federal government can legally incur. It is a way for the government to manage its debt and ensure that it does not become unsustainable.
There are several reasons why the debt ceiling has been raised again and again:
- Congress has a tendency to spend more money than the government takes in through revenue, and the debt ceiling provides a mechanism for controlling spending.
- The debt ceiling can be used as a tool for negotiating spending and budgetary priorities. For example, if the government is close to reaching the debt ceiling, Congress may use the threat of a default to force spending cuts or reforms.
- The debt ceiling can be used as a way to control the growth of the national debt. By limiting the amount of debt that the government can incur, the debt ceiling can help prevent the national debt from becoming unsustainable.
There are both pros and cons to the endlessly rising debt ceiling:
Pros:
- The debt ceiling can provide a mechanism for controlling spending and preventing the national debt from becoming unsustainable.
- The debt ceiling can be used as a tool for negotiating spending and budgetary priorities.
Cons:
- The constant need to raise the debt ceiling can create uncertainty and instability in the financial markets.
- The debt ceiling can lead to government shutdowns if Congress is unable to agree on a spending plan.
- The debt ceiling can lead to a downgrade of the government's credit rating, which can increase the cost of borrowing money.
Overall, the debt ceiling is an important tool for managing the national debt, but its repeated use can have negative consequences. It is important for Congress to use the debt ceiling responsibly and to find a way to address the long-term structural issues that contribute to the growth of the national debt.