Commentary by Dr. Thomas Sowell - The big news, as far as the media are concerned, is the political game of debt-ceiling chicken that is being played by Democrats and Republicans in Washington. However the current debt-ceiling crisis turns out, the current economic turmoil in financial markets around the world should cause some serious thoughts about the long run, and about the whole idea of a national debt-ceiling. Some people may have been shocked when the credit-rating firm Moody's recently suggested that the debt-ceiling law be repealed, in order to avoid fiscal crises which can throw world financial markets into turmoil that can injure countries around the world. Anyone who wants to show that Moody's is wrong should be prepared to show the actual benefits of the debt-ceiling, not its goals or hopes. That will not be easy, if possible at all. Too many policies, programs and institutions are judged by what they are supposed to do, rather than by what they actually do and the consequences of their actions. The United Nations, for example, survives as a glorious idea, despite how corrupt, counterproductive and even dangerous its actions are. The national debt-ceiling law should be judged by what it actually does, not by how good an idea it seems to be. The one thing that the national debt-ceiling has never done is to put a ceiling on the rising national debt. Time and time again, for years on end, the national debt-ceiling has been raised whenever the national debt gets near whatever the current ceiling might be. Regardless of what it is supposed to do, what the national debt-ceiling actually does is enable any administration to get all the political benefits of runaway spending for the benefit of their favorite constituencies -- and then invite the opposition party to share the blame, by either raising the national debt ceiling, or by voting for unpopular cutbacks in spending or increases in taxes.
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Sowell: Debt-Ceiling Chicken
Commentary by Dr. Thomas Sowell - The big news, as far as the media are concerned, is the political game of debt-ceiling chicken that is being played by Democrats and Republicans in Washington. However the current debt-ceiling crisis turns out, the current economic turmoil in financial markets around the world should cause some serious thoughts about the long run, and about the whole idea of a national debt-ceiling. Some people may have been shocked when the credit-rating firm Moody's recently suggested that the debt-ceiling law be repealed, in order to avoid fiscal crises which can throw world financial markets into turmoil that can injure countries around the world. Anyone who wants to show that Moody's is wrong should be prepared to show the actual benefits of the debt-ceiling, not its goals or hopes. That will not be easy, if possible at all. Too many policies, programs and institutions are judged by what they are supposed to do, rather than by what they actually do and the consequences of their actions. The United Nations, for example, survives as a glorious idea, despite how corrupt, counterproductive and even dangerous its actions are. The national debt-ceiling law should be judged by what it actually does, not by how good an idea it seems to be. The one thing that the national debt-ceiling has never done is to put a ceiling on the rising national debt. Time and time again, for years on end, the national debt-ceiling has been raised whenever the national debt gets near whatever the current ceiling might be. Regardless of what it is supposed to do, what the national debt-ceiling actually does is enable any administration to get all the political benefits of runaway spending for the benefit of their favorite constituencies -- and then invite the opposition party to share the blame, by either raising the national debt ceiling, or by voting for unpopular cutbacks in spending or increases in taxes. Read more
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