February 4th, 2010—Americans for Limited Government President Bill Wilson today issued the following statement on today’s imminent vote in the House of Representatives increasing the national debt ceiling by $1.9 trillion to $14.294 trillion:
“House Democrats, in order to pass the largest debt increase in American history, are arguing that if Congress fails to increase the debt ceiling, the U.S. will ‘default.’
“This is inaccurate. If this bill fails, the U.S. will not fail to pay interest on its debt obligations nor to make debt payments. Therefore, the nation will not default, unless House Democrats are stipulating that the U.S. actually needs to borrow more money simply to make national debt payments.
“What will happen should the vote fail nis the U.S. would not be able to borrow any more money for so-called ‘mandatory’ spending. This differs drastically from failure to make debt payments. ‘Mandatory’ spending is not actually mandatory, it could be cut. Discretionary spending could be cut, too, if Congress preferred to keep ‘mandatory’ spending levels at current levels.
“But, the American people and their representatives in Congress are under absolutely no obligation to borrow more money to pay for Congress’ preferred level of spending.
“The U.S. is at considerable risk of default, but it will not result from a failure to increase borrowing, which is what this bill will do. Default will only result because we have increased borrowing to unsustainable levels, which is what increasing the debt ceiling by nearly $2 trillion represents.”
“The only solution to the nation’s financial Apocalypse, where Moody’s is preparing to downgrade our Triple-A debt rating, is to reduce spending, not to borrow more money.”