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  • Heritage Video: Congress Maxes-Out Credit Card, Then Raises Its Limit

    With Congress looking to spend its way out of the recession, it’s running into a bit of a hiccup: the government’s credit card is about to be maxed-out.

    And big spenders in Congress aren’t planning on cutting spending in order to balance the budget. Instead, Congress will raise the debt limit by an additional $1.9 trillion, allowing the government to borrow (and spend) even more money. In other words, Congress will effectively raise the credit limit on its own credit card.

    How, exactly, does the debt limit work? How did Congress get in this position of borrowing, spending, and raising the debt limit so it can spend even more?

    Watch this Heritage Foundation video to see the whole story in plain English.

    Posted in Ongoing Priorities [slideshow_deploy]

    30 Responses to Heritage Video: Congress Maxes-Out Credit Card, Then Raises Its Limit

    1. J.C. Hughes, Texas says:

      Sorry guys, the pool goes, the guard shack stays. Federal priorities you know. In all seriousness, such an elementary concept doesn't mix well with the socialists' grandiose scheme. The current gang of elected elitists believe they're "too big to fail". But fail they will. It's only a matter of time.

    2. Sherry Hoffman, Texa says:

      NNNNOOOOOO!!!! Enough is enough! We need to stop the bleeding.

    3. Roger S., Ma. says:

      Time to cut congressional salaries in proportion to a rise in the debt limit. That ought to be law. It would teach them soon enough. Also, term limits! Term limits! Term limits! No lobbying! No soliciting! No begging! A sign on every office door in the Capitol (also by law): "NO!" People will know what it means! (Else, add some fine print: "Beggars will face arrest and indictment for criminal trespass!"

    4. Stirling, Huntingdon says:

      Good, simple, and to the point explanation. I'd give it an A. Let's hope enough people who need a better understanding will see this before the next election in 2010. I'd like to see a video contrasting socialism v.s capitialism/free market system to show just how far this administration has and is taking us in that direction. The line is being blured by those who think the policies of this administration are actually still capitalism/free market. I'm sure people are waking up to whats going on but the "reference point" to what is actually capitalism is being moved.

    5. Ozzy6900, CT says:

      We Conservatives have said NO for years but the reality is when you say no, the Liberals put the babies, children and schools in the headlines. This turns the Moderates right back to allowing the spending. The simple fact is no one wants THEIR pie cut!

    6. Ron Derry NH says:

      This is what a death spiral looks like, when the addict can't help himself anymore.

      Congress has no business in the business of debt inflation, and no business running our economics.

      If I were to guess at it I'd say they have no solution at this point and are totally addicted to destroying our economy for the sake of buying their power in hopes their bought friends will comfort them in the fall…as an addict does.

    7. Garrett Randel, Eagl says:

      There are no simple solutions to complex problems, but an essential step to getting our debt situation under control is term limits for senators and representatives. "Professional" politicians are not going to limit their own access to power voluntarily, so how can we produce a term limits ammendment to the Constitution?

    8. Charles Rathbun says:

      actually the plan IS to fail. I think a pair of socialists that Obama and his thugs use as role models: Cloward & Piven. In a nutshell, they taught that the way to seize control with the least resistance was to bankrupt the system and then, in the ensuing chaos, take over. All of the big issues that have been rammed through Congress in 09 are about paying off buddies and trying to bring down the system. Tax and Spend…they're definitely living up to their "name".

    9. Charles Rathbun says:

      I hope our great republic can SURVIVE until the 2010 election and that the Obama-controlled gerrymandering that will result from skewed census data won't make their re-election a shoo-in

    10. Michael Lyons, San A says:

      Simple and to the point. The unanswered question is what happens when the interest on that debt begins to exceed all the tax revenue the government brings in?

    11. Richard, Orange Coun says:

      Unfortunately we don't have until Nov 2010. This will pass. Then what? Get rid of the Toms.

    12. Kelly Garvey, Norman says:

      The interest on $14 trillion is $840 billion per year. This is at 6%. We aren't paying 6% now, but we will be shortly. That's a debt service of $2.3 billion per day!!! What a terrible thing to do to our children and grandchildren…

    13. E. Downing, Tucson, says:

      If 44% of congressmen are millionaires, versus only one percent of the public, wouldn't term limits be a good solution to the insanity going on in Washington?

    14. C.K, MA says:

      Excellent video and explanation.

      What no one is bringing up is how the gov. – federal and states – is waging war on business through regulation, and growing its own payroll by hiring people to oversee the regulations.

    15. Matt, California says:

      Excellent explanation. It really is that simple isn't it. Not in Kalifornia where a "balanced budget" is incomprehensible conservativespeak not understood by the unions, public employees, trial lawyers and green weinies. I like the Heritage.org site, bit if you are really worried about where the Country is headed go to survivalblog.com .

    16. blackjack3 says:

      J.C

      Sherry

      Roger

      Stirling

      Ozzy

      Garrett

      I don't post much, but I agree with each of you!

      We have a government that isn't listening to us. They have failed at protecting us on our southern border,that lets in who knows what! And they want to run our health care!! Will we get justice out of the Supreme Court? Goodness, it don't look good for us if they keep up their actions. Who runs this country!

      Hehe, I just wish we could educate the others!

    17. blackjack3, OK says:

      I don’t post much, but I agree with each of you!

      We have a government that isn’t listening to us. They have failed at protecting us on our southern border,that lets in who knows what! And they want to run our health care!! Will we get justice out of the Supreme Court? Goodness, it don’t look good for us if they keep up their actions. Who runs this country!

      Hehe, I just wish we could educate the others!

    18. MrShorty, Arizona says:

      I have long been a believer in "no term limits" because it would allow "good" people to stay in Congress and rise to positions of power. However, the results of the last election and the current state of affairs has changed my mind. Pork and entitlements are the things that swing votes and lead to "non-representative" government. It is now time to change things back to where the founding fathers wanted them to be…good people of clear concsious to make laws for the betterment of all citizens.

      Vote the bums out and institute term limits.

    19. Jae, Southern Pines, says:

      Ha! Ha! Ha! So, you think that this has a happy ending? I don't think so.

      The supposition is that people give a crap. For those that actually graduated from high school – about 50% of the population – they may grasp what this is about. For the rest, they are already sucking from the public teat and don't plan on stopping. In fact, their numbers are now sufficient to hold the rest of us hostage and get pretty much anything they want by voting for the "right" candidate.

      To prove that the above is working, looking what is happening with the "right" legislatures in place. Free homes (subsidized home mortgage give aways), free cars (subsidized car loan give aways), free food (subsidized food in the form of food stamps), no federal taxes (hey, here they actually get thousands back!). And, soon, free medical care!

      Welcome to your nightmare!

    20. Bob H,Colorado Sprin says:

      Just imagine if every high school student saw this. As simplified as it is, what it could do to the future of their lives could be immense! It's a shame what our goverment as digressed into!

    21. Larry Owens, Bluffto says:

      Why is this old saying so hard to understand? "When you find yourself in a hole, the first thing you need to do is stop digging." I think these progress zealots are deliberately trying to bring about an economic disaster so they can just totally scrap the Constitution and turn this into a totalitarian state. Stupidity couldn't cover all the destructive things they're doing.

    22. Pingback: Carte Blanche « writewild

    23. Roger Stan, Jville, says:

      Remember prior to 2009 when we heard nothing but billions wether in budgets or bills. All of a suddan Burserk Obama falls in office, and then we hear nothing but trillions. Yes it's a Democratic party that's doing it. But remember when the Republicans had their short run, and they didn't show any better.

      So are we to believe that Durban, Reid, Cobb, Pelosi, Nelson, Lieberman & all the 20 plus year Democraps, were all Sociallists in hiding just waiting for a half white president to change America into a Communistic State of Cuba??? Now we know that the word Democrat means Socialist forevermore!!!

      All these Socialist (Dems) voted in, in all these states, didn't run their elections with a socialist champaign agenda. And all these Democraps would not have been elected!!! They were elected to a "national" office, to protect our 200+ year constitution, not to spit on it and the people who elected them!!

      I do think it's time for term limits or we do away with the party system. After all, many people get elected to school boards & committies based on their personal abilities!! If term limits is used. It needs to be set at 12 years (6x2yr:2x6yr) with 12yr minimum between running again. And quit electing lawyers!!

    24. Bill, Philadelphia says:

      Sad, It's a shame you guys weren't paying this much attention the last 8 years, Maybe we wouldn't be in this mess. All the tea bag rally's might have help stop Bush's spending.

    25. Carl S., Columbus, O says:

      This should be shown in every elementary school across the nation, as well as run as a public service announcement on tv during primetime.

    26. Paul W., Santa Clara says:

      We can't spend our way out of a recession. The more we spend, the higher our debt load, and the interest on what we owe grows. We've gotten to the point where simply the interest on what we owe is more than we can afford to pay, let alone pay off any of the principal. We need to: 1) Cut the size of government, 2) Cut the cost of government, 3) Do away with useless 'special interest' funding (like grants to study the effects of cow farts on global warming), 4) Enact a law that states that a single bill passed by congress cannot contain smaller 'riders' that have nothing to do with the primary goal of the legislation. Each bill must stand on its own, and if it can't, then it shouldn't be passed into law. We need to run the government of the United States as if it were a company, one that will NOT be bailed out by a generous benefactor. We must stop spending what we don't have, and passing the burden of payment onto our children and our grandchildren, and our great-grandchildren. We must start paying off our principal debt, and push for elimination of that debt in as short a time as fiscally possible. Once we are free of national debt, then we can: 1) Stop issuing bonds and T-Bills (Borrowing money), 2) Use the income from taxes to do extraordinary things (like tackle climate change or cure cancer), and 3) Reduce the tax burden on all US citizens. Right now, the interest alone on the national debt amounts to nearly 40% of the entire annual budget of the US. But are we paying it? No. We are simply changing the rules mid-stream, allowing us to borrow more. We're robbing Peter to pay Paul. But the people our government is robbing from isn't just you, but your children and their children, and so on, and so on, until this problem is finally addressed and fixed. Let's work to fix it now. It will take a long time, but the sooner we start, the sooner we'll be free of debt and be on the road to a prosperous future for everyone.

    27. osnowi says:

      You folks really drink the Kool-Aid!

      Ronald Reagan used the theory to cut taxes on rich people and businesses, that those tax cuts would cause them to take their surplus money and build factories or import large quantities of cheap stuff from low-labor countries, and that the more stuff there was supplying the economy the faster it would grow.

      Greenspan told Reagan to dramatically increase taxes on people earning under $37,800 a year by increasing the Social Security (FICA) tax, and then let the government borrow those newfound hundreds of billions of dollars off-the-books to make the deficit look better than it was. – Cool theory!

      Reagan & Greenspan took the federal budget deficit from under a trillion dollars in 1980 to almost three trillion by 1988. They and George HW Bush ran up more debt in eight years than every president in history, from George Washington to Jimmy Carter, combined.

      2001 – George W. Bush embraced the theory with gusto, ramming through huge tax cuts – particularly a cut to a maximum 15 percent income tax rate on people like himself who made their principle income from sitting around the pool waiting for their dividend or capital gains checks to arrive in the mail – and blowing out federal spending. Bush even out-spent Reagan, which nobody had ever thought would again be possible.

      And it all seemed to be going so well, just as it did in the early 1920s when a series of three consecutive Republican presidents cut income taxes on the uber-rich from over 70 percent to under 30 percent. In 1929, pretty much everybody realized that instead of building factories with all that extra money, the rich had been pouring it into the stock market, inflating a bubble that – like an inexorable law of nature – would have to burst. But the people who remembered that lesson were mostly all dead by 2005.

      Too late now.

    28. Sean, DC says:

      Funny, I don't recall this site tsk'ing the last administration when it raised the debt ceiling 7 times. Odd that they don't remember that now…

    29. Pingback: Democrat Health Care Reform Will Not Decrease Deficit | The Foundry: Conservative Policy News.

    30. Pingback: Obamacare Will Decrease the Deficit? Yeah, Right! | Conservative Principles Now

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