The threat of a default on the debt is a political ploy and an extension of a crook’s book keeping. (The crook is the government.)
Failure to raise the debt limit would not necessarily precipitate a default by the United States–not unless the politicians orchestrate such a default, which they invariably do.
The U.S. government has debt obligations and other expenditures. It raises sufficient revenue from We The suckers to discharge its obligations.
The federal government raises trillions of dollars in tax revenue each year, though there are many different kinds of taxes. Some taxes fund specific government programs, while other taxes fund the government in general. … Total federal tax revenues in fiscal year 2014 are projected to be $3 trillion.
As PAT TOOMEY pointed out 2 years back, when the same “debate” was being rehashed, “If Congress refuses to raise the debt ceiling, the federal government will still have more than enough money to fully service our debt.”
UPDATE (9/30): OBAMA BANANA. There once was an African “leader” by the name of Canaan Banana. Truly. He was far and away a better man than Obama. Just free associating.
Here is Mark Steyn on Obama Banana’s attitude to debt:
This is the United States of America,” declared President Obama to the burghers of Liberty, Mo., on Friday. “We’re not some banana republic.”
He was talking about the Annual Raising of the Debt Ceiling, which glorious American tradition seems to come round earlier every year. “This is not a deadbeat nation,” President Obama continued. “We don’t run out on our tab.” True. But we don’t pay it off either. We just keep running it up, ever higher. And every time the bartender says, “Mebbe you’ve had enough, pal,” we protest, “Jush another couple trillion for the road. Set ’em up, Joe.” And he gives you that look that kinda says he wishes you’d run out on your tab back when it was $23.68.
Still, Obama is right. We’re not a banana republic, if only because the debt of banana republics is denominated in a currency other than their own — i.e., the U.S. dollar. When you’re the guys who print the global currency, you can run up debts undreamt of by your average generalissimo. As Obama explained in another of his recent speeches, “Raising the debt ceiling, which has been done over a hundred times, does not increase our debt.” I won’t even pretend to know what he and his speechwriters meant by that one, but the fact that raising the debt ceiling “has been done over a hundred times” does suggest that spending more than it takes in is now a permanent feature of American government. And no one has plans to do anything about it. Which is certainly banana republic-esque.