The debt limit restricts government expenditures to the amount of its incoming revenues; it does not prohibit the government from servicing its debt. There will be no default if Congress decides not to raise the debt limit. The government is required by the 14th Amendment to pay its debt obligations, and it can service our $17 trillion debt with less than 10% of federal revenues. This is not a close or a difficult question, and, as I noted here, the market is not showing any fear of a default. Because there can’t be one. Rarely has there been an issue on which journalistic malpractice has been so rampant powerlineblog/archives/2013/10/moodys-confirms-us-wont-default.php?fb_action_ids=10202373882812303&fb_action_types=og.likes&fb_source=other_multiline&action_object_map=%7B%2210202373882812303%22%3A601668276542081%7D&action_type_map=%7B%2210202373882812303%22%3A%22og.likes%22%7D&action_ref_map=%5B%5D
Posted on: Thu, 10 Oct 2013 13:02:59 +0000
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