Voters Take the Risk for Democrats’ “Bold” Increase in the Federal Debt Ceiling

In what the mainstream media is calling a “bold, but risky year-end strategy,” Democrats are setting the stage to raise the federal debt ceiling by $1.8 trillion before the end of this year to avoid having to deal with the issue again before the 2010 elections.

At first, the size of the increase numbs the mind making the figure almost meaningless to the average voter. After all, how often has anyone ever dealt with 1.8 trillion of anything?

It seems beyond comprehension and therefore, we almost ignore it. Unfortunately, we’re talking about debt that has been taken out “on our behalf” – and thus we will each have to contend with repaying our portion via higher taxes or inflation.

So, what’s your share of this incomprehensible obligation? Well, actually, that part is a relatively easy calculation:

There are approximately 300 million citizens in the United States today, so your portion is $1.8 trillion divided by 300 million.

That works out to about $6,000 per citizen.

I don’t know about you, but I didn’t budget for a surprise year-end expense on my national credit card of $6,000.

If that’s not bad enough, you have to understand that not all 300 million citizens actually work, much less, pay their fair share of taxes – if any at all. For example, your spouse may or not work and your under-aged children probably don’t. So, if you’re a family of four with a non-working spouse and children in school, the burden you’ll shoulder personally is actually four times that amount or $24,000.

“But wait!,” you say, “I can’t afford that!”  Well, perhaps it’s time, then, that you share your concern to Washington because they seem to think “Yes, you can!”

“We’ve incurred this debt. We have to pay our bills,” House Majority Leader Steny Hoyer stated. POLITICO reports that the Maryland Democrat confirmed that the anticipated increase could be as high as $1.8 trillion (or twice as high as what Congress assumed during last spring’s budget resolution for the 2010 fiscal year).

It appears that the House leadership held back the bill for weeks (saving it for when they thought we’d all be distracted by our own holiday spending). Well, the holidays have arrived and appropriations clerks have been instructed to have a final package ready to go. The leadership is betting that it’s better for the party to take its lumps now rather than risk further votes in the new year. Some might consider this a reckless strategy, however, over in the Senate Budget Committee Chairman Kent Conrad (D-N.D) revealed: “This is a defining moment.”

There are signs that the magnitude of this debt increase may be having some effect.

Senator Judd Gregg, the panel’s ranking Republican, is maneuvering to add deficit reduction legislation as an amendment to any bill tapped to carry the debt increase. This could create its own dynamic similar to another past debt ceiling fight in 1985 which gave rise to the Gramm-Rudman deficit reduction act mandating across-the-board spending cuts. Already in the Senate, there is talk in both parties for the creation of a bi-partisan task force empowered to force expedited votes in the next Congress on deficit reduction steps.

But with respect to this year, it appears our leaders in Washington are set. “It is December. We don’t really have a choice,” House Appropriations Committee Chairman Obey recently stated. “The bill’s already been run up, the credit card has already been used. When you get the bill in the mail, you need to pay it.”

The fact is that fiscal year 2009 ended Sept. 30 with a $1.4 trillion deficit. This demanded higher-than-expected Treasury borrowing resulting from the downturn in the economy and spending commitments in place before Barack Obama took office. So, as much as Republicans point to the president’s economic recovery bill as the cause, only a portion of that $787 billion package was spent by Sept. 30.

While the White House has vowed to be more deficit-conscious in its forthcoming 2011 budget due out in February, these appear to be just words as the Obama Administration is predicting the stimulus will hit its stride with much more spending. For example, transportation and housing resources would grow by 12 percent, including $2.5 billion for high-speed-rail investments on top of the $8 billion already added by the White House to the giant stimulus bill in February. A $163.5 budget for the Departments of Labor, Health and Human Services, and Education would add an additional $8.6 billion to annual spending and the Veterans Health Administration’s spending would grow to $45.1 billion – a $4.1 billion increase. Furthermore, the House could vote as early as this week on a $446.8 billion year-end package covering more than a dozen Cabinet departments and agencies, representing a healthy 9 to 10 percent increase over current spending for the same accounts.