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IPFS News Link • Government Debt & Financing

Gary North: The Symbolic Debt Ceiling

Basic to deception are symbols. Symbols serve politicians in much the same way as a red cape serves a matador. Every year, Congress goes through the equivalent of a Punch and Judy puppet show. This is the debate over whether or not to raise the Federal government's debt ceiling. The Federal debt-ceiling is always raised. There are no exceptions. As surely as night follows day, so does the national debt-ceiling get raised. Everyone in Congress knows this. Everyone in the media knows this. Those few voters who pay any attention suspect this. But there is always that long-shot possibility: a stalemate in Congress that lasts until the deadline runs out. Then there might be a showdown. Everyone in Washington knows that the ceiling will be raised. The proponents of flat-lining the ceiling would wind up with their careers flat-lined if they were ever successful. But if there is a fight, it will make great copy for pundits. The evening new shows will feature the story: "The nation faces a shut-down of the Federal government!" Suuuuure it does. The last time there was one of these battles was in 1995. The Republicans had taken control of the House in the election of 1994. The Contract With America was the rallying document: one of the really great campaign slogans in Republican Party history. It did not quite match "Had Enough?" in 1946, but it was close. So, the new Republican majority was ready to flex its muscles. The young Turks were ready to hold the line.