Well first off the debt ceiling is a political limitation not a market limitation. Which is why we're here. Without this procedural impasse then the markets would still happily keep lending money to the U.S.
One of the main reasons that the U.S. can't afford it is because they made a policy decisions 8 years ago to significantly reduce the amount of revenue the government was taking in in heavy tax cuts. That's a spending decision as well. They government couldn't afford to cut taxes based on their future income outlays, which is why we're here but I didn't hear people railing against that and I don't hear them talking about how they can't afford such low taxes now.
|