Geithner: Time to scrap the debt ceiling

Updated
 
Geithner: Time to scrap the debt ceiling
Geithner: Time to scrap the debt ceiling
Associated Press

Have you ever heard the theatrical saying, “If there’s a gun on the stage, it has to go off”? I think about the adage often when pondering the debt ceiling.

Between 1939 and 2010, Congress raised the debt limit 89 times. It was an easy, routine bit of legislative paperwork – the issue came up 89 times, and in 89 instances, Congress passed a clean bill. Even during the Bush presidency, Republicans raised the debt ceiling, without strings or preconditions, seven times. The current GOP leadership in Washington – John Boehner, Mitch McConnell, et all – has voted to raise the debt limit 19 times. Bush’s former budget director said this “ought to be treated as the housekeeping matter it is.”

For 71 years, in other words, the gun on the stage sat untouched by both parties.

In 2011, congressional Republicans, for the first time in American history, decided to pick up the gun, load it, and wave it around. Never before had an entire major-party caucus threatened the full faith and credit of the United States, and the man-made crisis that ensued was brutal, both for our economy, our political health, and our standing on the global stage.

Eventually, Democrats accepted concessions, and convinced Republicans to put down the gun. But early next year, it will time for another debt-ceiling vote, and GOP leaders have already said they’re once again prepared to do significant damage to the country, on purpose, unless new demands are met. With that in mind, Treasury Secretary Tim Geithner believes it’s time to take the gun off the stage permanently.

Treasury Secretary Timothy Geithner said the U.S. “absolutely” should get rid of the debt ceiling as soon as possible.

“It would have been time a long time ago to eliminate it,” Geithner told Bloomberg TV on Friday. “The sooner the better.” […]

“Only once, last summer, did people decide to use it to threaten default on the American credit for the first time in history as a tool for political advantage,” he continued. “And that’s not a tenable strategy for the country.”

Quite right. Having a debate over whether the United States will deliberately default on its debts – not to go through with it, just having the debate itself – is incredibly damaging. But knowing that the gun on the stage may go off eventually is itself dangerous, and in need of a resolution.

Matt Miller had a good column on this the other day.

The president knows he can’t let the precedent established last year become the new normal in budget talks. He knows the debt ceiling is a weird relic that no other country (save Denmark, sort of) possesses. In most nations, the act of the legislature passing a budget simultaneously authorizes its treasury to borrow whatever debt that budget contains. That’s only common sense.

If Ben Bernanke can press the limits of legal authority to save the economy, and Obama himself can press these limits to approve a “hit list” for drones, then defanging the debt ceiling should be child’s play by comparison. […]

Time to remove the fiscal appendix, Mr. President. For sane governance to live, the debt limit must die.

For the record, the nation is on track to next hit the debt ceiling in February. If the White House doesn’t make this part of the ongoing fiscal talks, it’s making a mistake.

Tim Geithner and Debt

Geithner: Time to scrap the debt ceiling

Updated