The Instigator
Con (against)
0 Points
The Contender
Pro (for)
8 Points

Should we (the U.S.A.) keep raising the debt limit?

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Voting Style: Open Point System: 7 Point
Started: 3/25/2014 Category: Politics
Updated: 7 years ago Status: Post Voting Period
Viewed: 1,076 times Debate No: 49863
Debate Rounds (2)
Comments (1)
Votes (2)




I understand that the government wants to stay open, so that they can keep working. Yet, if we as a nation keep raising the debt ceiling, are we not just putting ourselves further into a already deep hole of a now seemingly unpayable debt to the world? I will quote what a friend of mine said on this topic: "When everyone's sewage backs up, and the world starts becoming flooded with crap, do you try to take care of the problem by fixing the sewage and settling all of your issues, or do you build a higher roof and try to wait it out and hope it resolves itself?" Well, if you fix it when crap becomes high enough to be a problem, you should probably take care of it then and there. If you keep building a higher ceiling and try to wait it out, you are just running from your problems. No one is going to fix your problems for you, because they are YOUR problems, not anyone else's. We as a nation need to buck up and start taking out the trash (A.K.A. our debt). We need to quit running from everything!


Thanks to my opponent for providing this topic for debate, as I think it's an important economic issue that has burdened us in recent times. With that, I'll launch into some argumentation. As this is only two rounds, and as my opponent has started his argument already, I feel it is warranted for me to both begin mine and respond to his.

First of all, I think it's important that we establish what the debt ceiling is, something my opponent has not yet done.

"The debt ceiling constrains how much debt the federal government can carry at a given time in order to pay for its operations."[1]

In other words, it's an arbitrary limit imposed on the federal government for the amount of debt it can pay off given its current funding structure. Now, what do we mean by raising the debt ceiling? It functions as our sole way to borrow funds to pay off our debts should we reach that limit. Realize that these are prior debts - the funds were already borrowed, and the genie cannot go back into the bottle. We owe that money. The debt ceiling merely constrains how much of it we can pay back.[1]

In other words, my opponent is arguing that we should continue to be constrained by this limit, and be therefore limited in our ability to pay back debt we already owe.

Now, what does it mean, then, to hit that ceiling?

The reality is that it's never happened before, so no one truly knows. However, we have a pretty good idea of what it would look like. We know it will trigger a default for the first time in U.S. history if we fail to pay off any of our loans, but it's difficult to evaluate exactly what that means.

So before I do, lets talk about what most certainly will happen. Financial markets, as they have every time we've neared the debt ceiling, will sink. There's little question of this - if they can't trust the rock solid U.S. to pay off its debts, then they're all put at risk as well. U.S. T-bill holders, who hold most of our debt, are depending on the U.S. being stable enough to actually pay off the debt they hold, and the loss of that stability means we now have to export even more of our debt. Of course, that means that these will likely be paid off first. However, this leads to a precarious balancing act. We now must prioritize payments.

Why is that bad? Well, for one thing, some funds are going to get the short end of the stick. The Bipartisan Policy Center estimates that this would lead to an immediate 32% spending cut, as revenue would be insufficient to cover the costs and, with no certainty of being able to cover already rising costs, the government would need to keep some in reserve. Goldman Sachs estimates that, if it were to remain immobile, our spending would plummet to $175 billion, or 1% of the current economy. Various government services would have to shut down. Social Security checks would likely be delayed, for one. Government contractors would likely see their pay disappear, meaning you're not going to get many people working with the government on major projects for a while. Medicare reimbursements are going to dwindle as well, forcing the elderly to pay for care they cannot afford. Stock markets would plummet, household wealth would shrink, consumer confidence would plunge, and with it would go our spending habits. And since countries our credit rating was affected just by us getting close to the ceiling without raising it, if we reach it, that rating will drop dramatically. That means that the interest on any loan we get will increase dramatically, increasing the debt we owe.[2] Remember, this is if things go according to plan.

More importantly, this process is automated. The Treasury's computer systems aren't equipped to do anything other than pay off of the full debt. This means that they will have to pay all of our bills manually, and given that there are a tremendous number of them, that puts us in a distinctly bad position, as any small mistake can lead to default.

So let's get to the impacts of default, then. Why should we care?

"Banks in the United States and overseas use Treasurys as collateral when they borrow from each other. If Treasurys were no longer seen as risk-free, it would disrupt borrowing and jolt credit markets. A financial crisis like the one in 2008 could follow.

Banks also hold much of their capital reserves in Treasurys. If they fell in value after a default, banks would have to cut back on lending."

In other words, recession or depression await.

This is what my opponent proposes we do. So let's look at his reasons why. After all, the burden is chiefly on him, as we currently do raise the debt ceiling, have done it approximately 120 times.[3] It's up to him to prove that these instances have been harmful, and that future policy should not emulate past.

So what does he give us in support? He says that we're "putting ourselves further into a already deep hole of a now seemingly unpayable debt to the world." He fails to recognize that the debt ceiling doesn't increase debt accrued, but rather, authorizes payment of debt owed. He provides no analysis as to why increasing the debt ceiling similarly increases U.S. borrowing. Even if it did, Con provides no actual harms that result from this increased debt. He says we may not be able to pay it back for a while, but that doesn't impact very much. Current interest payments equal about 1.4% of GDP, meaning that the cost to the economy is far less simply to pay off interest and even start paying off our loans than it is to go through default.[4] That number could increase, but to nowhere near the levels to make default an acceptable alternative.

Con also utilizes this sewage analogy, from a "friend" apparently (though I can't say how much of an expert on economics either of them may be), of course ignoring the fact that this isn't sewage, and rather the basic means by which our country begins to function, that he would siphon out. But what he doesn't seem to realize is that, even if his analogy is accurate, it's misstated, since he's not just "fixing the sewage and settling all of your issues." Con is increasing the debt owed by the U.S. government by dropping our credit rating and damaging our economy. It would be more akin to seeing these rising levels of sewage, and responding by setting it all ablaze. Better to let the sewage rise than to burn everyone alive, in my opinion.

Lastly, Con is essentially creating a false dichotomy here. He's saying that we cannot possibly solve for the problems of increased costs and increase the debt ceiling. I disagree. I think we can do both. We can increase the debt ceiling, pay off our bills, and work on effective ways to decrease spending. That way, we don't default, and we get all the beneficial impacts of reducing the levels of "sewage." It's a win-win.

With that, I leave it to Con to finish out his side of the debate.

Debate Round No. 1


I will say one thing for you Pro, I like your support for your argument. It has made me have to rethink the basis of my argument, but I still think that we should not keep raising the debt ceiling. By the way, the sewage I mentioned is all of the problems we have put on ourselves with our debt. And I apologize for assuming it would be implied that we would obviously have to go through some bad times to get to the great ones. By not working more towards actually paying our debt ( For example, President Barack Obama has , since he became president in 2009, acquired more than $6 trillion in debt [1]) President Obama, according to my first source has criticized former President George W. Bush as being "un-Patriotic" for amassing a roughly estimated $4 trillion in debt. Do not get me wrong, I do not intend to turn this debate into a hate-Obama argument in any way, I'm just trying to show how our debt in the past decade or so has risen dramatically. By the way, just for reference, our current total national debt is, as of March 2014, $17,548,206,894,037.06 [2]. Last year, we as a nation only payed back $35 billion of our total debt, and immediately gained $108 billion more in debt![3] So, yes the debt ceiling allows us to borrow more to pay back more of our debt, but if you will notice, we have to borrow (meaning we eventually have to pay that back also) to pay back what we have already borrowed. It no longer seems like a win-win anymore. I understand that if we do this, and then end up defaulting, the U.S. will be in for some really hard times, I know we will. But, we will come back from it, look at the great depression, which I understand was not as bad as this most likely would be, but either way it took a while to recover, yet we still did in the end. And immediately afterward had to join World War 2. And, so I make myself perfectly clear, being in a war costs money, so the U.S. sold war bonds to help pay for the war expenses. So, that goes to show that we always will be able to figure out something to help ourselves when we are in peril. I would like to finish by quoting a popular saying in a variation to fit this situation; "you have to spend money to gain money." I am just saying that, just like you have to work hard in order to be able to play hard, and that the bad times you first endure to make the good ones even better, the same thing goes with our debt. Thanks to my opponent for joining me on this argument, I look forward to reading your response on this.


Thank you to my opponent for the praise and for this debate. I haven't had a good economic debate since I arrived on this site, and I was happy to engage in this one with him.

With that said, I'm first going to start with an overview of the debate, putting things into simpler and more personal terms, and then I'll utilize that overview to frame my rebuttal and conclusions.

What we're arguing here is a question of loans and their repayment, so I think it's not farfetched to compare this situation to one of a person getting some monetary assistance from a loan shark. The shark expects to be repaid, but you have very good credit " you've worked with him often, and he's grown to like you. Hence, he's given you a better deal than most of his clientele, allowing you to pay back your loan in small increments as long as you keep up with the interest rates.

Of course, this is still a loan shark, not a bank. He will break your legs if you fail to come through. What's more, he'll raise your interest rates, making it that much harder to pay them off the next time, and you don't want to find out what he'll break then.

But you've taken on a lot of loans recently. The costs of repaying those loans has risen to dizzying heights, and your interest rates are trending upward. You value your legs and well-being, as well as your good credit, but you also value your family and the life you've built for yourself. You know you can continue to meet the loan shark's conditions for a while yet, but you're uncertain just how long that will last.

Now, when I see this problem, my prescription is to solve the problem by slowly reducing my spending by manageable amounts, and perhaps to get a new job to acquire more revenue. To bring this back to the topic of debate, I'd advise to bring down spending slowly, and make efforts to bring the debt down to manageable levels.

Con is addressing this differently. He's advising a similar reduction in spending " perhaps the same, since neither of us have been too specific on this front " but he's also advising that we not continue to raise the debt ceiling. Bringing this back to the loan shark, Con wants to tell the loan shark that he can only pay part of what he owes this week rather than dip into his savings further. Con's going to get his legs broken. Depending on how quickly he reduces his spending, he could either put his family in the poor house, or explore the many ways this loan shark will inflict pain on him over the coming weeks as he tries to get enough money to stay within his budget.

However, this isn't Con's legs we're talking about. We're talking about breaking America's legs " metaphorically, of course. Rather than dipping further into funds loaned by the Federal Reserve to cover budget shortfalls, we'd default. Our economy would be irretrievably damaged, much like a set of shattered legs. There's no putting the pieces back together when our credit rating plummets.

There's no retrieving the confidence of the loan shark, just as there's no way any country will trust us as they do now, even several decades out. One default is all it takes, and they'll respond by making it all the more expensive and difficult to pay off our loans, just as the loan shark would. Sure, we haven't built more debt by dipping further into our finances than is currently economically feasible, but we've created more long-term economic problems, not fewer.

Con still never impacts why dipping further into the Federal Reserve suddenly becomes catastrophic, nor does he state any major harms in status quo to that very large amount of debt he cited. Meanwhile, he's granting my harms scenarios, which are only certain to happen under his case. He's the only one at the end of the debate with shattered legs that won't heal, limited access to further loans, and exponentially higher interest rates.

Going back to the analogy, Con explains that there will be better days ahead. Sure, that loan shark battered him good, and maybe his family suffers for a few years or so, but they'll come out of it right as rain with a balanced budget and a more economically savvy lifestyle. He uses the fact that we exited the Great Depression as proof that all will be fine in the long term.

Of course, this ignores the reality of debt, and the interest hikes that he conceded are certain. These won't go away because we learned our lesson, just as that scary loan shark won't stop making menacing calls to his house demanding increasing amounts of money.

Perhaps Con means to sell his possessions to pay off the loan shark, but that leaves he and his family in the hole financially, putting them at risk of any number of other increased costs. The same is true for the country. Sure, we could stop Medicare and Medicaid, and essentially watch as our elderly and poor drop like flies while begging for medical interventions. We could stop building infrastructure, and watch roads crack and bridges collapse, causing billions of dollars of damage to cars, ships and buildings. We could stop funding education and watch our schools fall into disrepair, our literacy rates plummet, and dramatically reduce the crop of successful professional workers to boost the economy in the decades to come. Saving ourselves from the loan shark has made us all sick for want of necessities.

Con is actually banking on something, anything, to avert economic oblivion. Maybe he's not supporting a war (as many believe that WWII ended the Depression), but rather just a major event that changes the game for us. The reality is that there's no way to predict that anything like that will happen, and no way to be certain of its effects on our country. He's provided no reason to believe that such an event is on the horizon, nor that it's ever going to come. He's banking on something that is dramatically uncertain at best, and offering his legs up as collateral to the loan shark to reach that uncertain point in the distant future.

Look, I think in the end, we all agree that changes need to be made. We can argue about whether Obama is doing a good enough job, but I think our goals in any economic policy shift should be first to minimize the harm of our own actions and second to achieve long term goals of economic stability. Con appears to prioritize the latter, without realizing that the possible harms he's conceding will happen are nearly certain to prevent those goals from ever happening. In a world of uncertainties, we should take the path forward that ensures the most stability and doesn't hedge our bets on amorphous and implausible future events.

So if you agree with me, and like your legs in their current orientation (no, that is not a threat), then I urge you to vote Pro.
Debate Round No. 2
1 comment has been posted on this debate.
Posted by 1ReconMarine 7 years ago
The US needs to Pass a Balanced Budget and stick to it...
We need to Stop the Spending that is running rampant in this Admin, and Start paying Down the Debt...
You cannot Spend your way Out of Debt...that is Basic Economy 101
2 votes have been placed for this debate. Showing 1 through 2 records.
Vote Placed by SeventhProfessor 7 years ago
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Total points awarded:05 
Reasons for voting decision: Both made excellent points, but Con didn't rebut Pro's R1 arguments (args). While both used sources, Con's were heavily biased to the right, and Pro's seemed to take a more neutral stance.
Vote Placed by EndarkenedRationalist 7 years ago
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Total points awarded:03 
Reasons for voting decision: Well, I suppose this debate gives new meaning to the phrase "break a leg." Nobody? Huh. Anyway, CON's first argument was purely emotional rhetoric while his second was was mostly facts regarding what the debt is/who increased it. In the future, CON, I recommend you combine the emotional rhetoric and existing data to support your case. CON failed to refute any of PRO's arguments in Round 1, and PRO had the enormous advantage of having an entire second round to develop them further. Pro correctly pointed out that much of CON's case rested on unverified hypotheticals. In the end, I award arguments to PRO.

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