Treasury Secretary John Snow has warned that unless Congress raises the national debt limit, the US government will run out of cash to finance its daily work in two months.

In a letter to Senate leaders Thursday, Snow said the statutory debt limit imposed by Congress of 8.184 trillion dollars would be reached in mid-February and the government would then lose its borrowing power.

“At that time, unless the debt limit is raised or the Treasury Department takes authorized extraordinary actions, we will be unable to continue to finance government operations,” said the letter…

Snow warned that even if the Treasury took “all available prudent and legal actions” to avoid breaching the ceiling, “we anticipate that we can finance government operations no longer than mid-March”.

Remember when the words “fiscal” and “conservative” side-by-side meant you were talking about a Republican?

  1. David says:

    Nothing surprising for many of us I guess.
    Might I suggest reading “Empire of Debt” by Bonner / Wiggins.
    More than enough good historical writing and commentary on where we are and where we are headed.

  2. Mike says:

    Fiscal conservatism was cast to the side when compassionate conservatism came on stage. It also doesn’t help that the Republicans, in order to maintain power, have learned to woo voters by abandoning principle and promoting a never ending growth of entitlement programs. It’s will all end someday, but they’ll be gone and the country will be bankrupt. Glad I’m still young enough to maybe be able to see it. 😐

  3. Mike Voice says:

    “… takes authorized extraordinary actions…”

    Doesn’t Elliot Spitzer empanel Grand Juries when corporations use “extraordinary actions”?? 🙂

  4. Rob says:

    This is my biggest thorn. DO NOT raise the debt limit. This is now the time to admit to the world we ned to get our financal house in order.

  5. Mike says:

    But by printing more money, they can inflate the currency. Then every dollar they borrow today will be worth less by the time it’s repaid. Government borrowing is one of the greatest scams ever.

  6. Sounds the Alarm says:

    There would be no debt issue had we not invaded Iraq.

  7. kzoodata says:

    To be sure, it’s a problem folks. So, what do we cut?

  8. Greg says:

    You have to cut spending AND raise taxes. No one likes that second one, but it has to be done. There’s not enough money to cut out given the level of debt we’re in and all the tax cuts we’ve had. Don’t give me crap about tax cuts paying for themselves, it hasn’t happened. Don’t give me crap about raising taxes will stunt the economy, people did great in the late 90s under Clinton’s higher taxes. This country is living on a credit card and Real Bad Things are going to happen if we don’t get ourselves in order. Someone’s going to have to be the grown up and do what needs to be done.

    I hope the Democrats take a house in 2006. At the very least they will be able to put the brakes on each new round of tax cuts. I don’t care if you’re a conservative and don’t have much faith in how they spend money. The current administration and Republican leadership have discredited themselves on all things financial, so it can’t possibly be any worse. Suck it up and vote for divided government. I don’t have any faith in the House or Senate Republicans replacing their leadership so it’s not going to change otherwise.

    I hope either the Democrats take the presidency in 2008 or if the Republicans keep it, they keep it with someone like McCain who actually cares about fiscal responsibility and will still represent a real change in leadership. McCain currently gets kind of a free ride from the left, he’s not as good as we think he is on all the issues we care about, but I trust him with the money. He’d still change the direction of the country on some issues. Nothing’s going to change in 2006 unless the Republicans lose a house.

  9. Incognito says:

    And to think we had a surplus just 6 short years ago.

    Raising the limit twice within 2 years thats very reckless.

  10. BOB G says:

    First there was never any surplus. That was all funny accounting. Second to the guy who wants to raise my taxes. I give the government a quarter of my income allreddy. And no I am not rich. I make less then 40 a year. But I am the rich guy the libs want to tax. Third the war is probebly the only legit federal activity I should be paying for.

  11. Mike Borginis says:

    More evidence of the plundering of all aspects of our society. I sure hope people start to wake up soon. If things continue the way they are, by the time these clowns leave office we will be in a hell of a mess. The next administration will be inheriting complete chaos.

    I expect that the true measure of the damage being done won’t be fully known for years.

  12. AB CD says:

    When Repulicans were really fiscal conservatives, Barry Goldwater was saying a 70 billion dollar budget shocked him, He lost 60-40 in the presidential election, and Democrats had 65 Senate seats back then. I think Republicans will take the path of 5% unemployment and 4% growth rates, and being in the majority.

  13. Greg says:

    This is an interesting bit of history from Juan Cole:

    In the 1950s, President Eisenhower routinely used the threat of calling in loans from war-devastated Europe to get his way. He threatened UK Prime Minister Anthony Eden with loan cancellations if the latter did not get back out of the Suez in late 1956. He threatened DeGaulle with loan cancellations if the latter didn’t get France out of rebellious Algeria before it went Communist. Nowadays the US is a massive debtor nation, and has lost that kind of leverage with all but the poorest and most beaten-down countries.

    Not only that, but now countries like China potentially have that kind of influence over us. We’re only still going because everyone’s playing nice for now, but the potential to put the screws to us is there. LIke I said, Real Bad Things can happen if we don’t get ourselves in order. Vote Democratic in 2006 to at least put the brakes on it, and we’ll see who puts forward the grownup in 2008.

  14. Teyecoon says:

    Can you tell me if any idiot, that was made President of this country, couldn’t have taken this amount of money that has been spent and have this country in as good as or better fiscal shape than Dumbya? Anyone can artificially pump up an economy if given unlimited credit to tap yet he seems to feel he deserves some kind of personal credit for averting a statistical recession.

    I also wouldn’t be surprised if the Republicans didn’t care if they lose the next election as long as they retain the House and Senate so that they can blame all the results of this Presidency on the next guy and make him do the dirty work of raising taxes and thus making the “liberal” image look even worse. Of course, all this needless corrupt spending today will be washed away in the Homeland Security argument so they really aren’t scared of going “hog wild” now.

  15. Eideard says:

    “Raising taxes” isn’t even what’s needed – IMHO. Return the tax giveaways from the Plutocrats of America. Remove giveaways to the military-industrial parasites from the federal budget. You’re on the way.

    Long range? Invest in the soundest base of the American economy — an educational system that offers of potential of a college-educated workforce. If a small nation like Eire can do all this — and they’re seeing the results within a decade — it’s absurd to say that we can’t.

  16. Incognito says:

    BOB G All accounting is funny. I doubt they cooked the books to the tune of 8.184 TRI TRI TRI TRI TRILLION DOLLARS.


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