July 29th, 2011
12:50 PM ET

The debt ceiling: Where you stand in battle

House Speaker John Boehner's debt plan was put on hold Thursday night after lacking the needed votes to pass, but he may try again Friday. The frustration about the inability of Congress and President Barack Obama to reach a deal to raise the debt ceiling and prevent a possible government default has sparked a firestorm of anger directed toward Washington.

But there's no shortage of people who believe they have the answer to solving the crisis or who is to blame for it.

As Washington struggles to reach a deal, CNN is listening to what you have to say about the debt fiasco as well thoughts from influential voices, politicians and analysts.

iReport: Your message to Congress

What is the solution for fixing the debt crisis?

With the both chambers of Congress seemingly unable to come up with a debt-ceiling solution, constitutional law professor Jack Balkin wrote about three ways Obama could bypass Congress and try to solve the crisis on his own.

"We are having a debt-ceiling crisis because Congress has given the president contradictory commands," Balkin said in a CNN.com opinion piece. "Congress has ordered the president to spend money, and it has forbidden him to borrow enough money to obey its orders." But Obama may be able to save the United States from defaulting, he suggests, perhaps by issuing two $1 trillion coins or selling the Federal Reserve an option on $2 trillion in property.

CNN.com readers jumped right into the conversation, discussing whether it would be the right move for Obama to sidestep Congress. One commenter named svscnn said: "I don't know if I'm relieved or concerned about some of the revelations in this article. While they all seem a bit shady, I suppose it's good to know that there are still some executive options on the table to keep us from going over the brink that Congress has brought us to."

Marc J. Yacht said he thinks that Obama is being “held hostage” and that he should stand his ground in the debt-ceiling debate.

“Use your power of the executive order to break the impasse, if you can,” Yacht told CNN's iReport. “Not raisng the debt ceiling undermines this country's stability. Equity and balance has to be the driving force in this debate.”

Skip Wininge, another iReporter, got so fed up with Congress’ inability to reform the tax structure that he has devised a plan of his own. He uploaded his thoughts to iReport, explaining, “Don’t pay for wars and tax cuts on the backs of senior citizens who barely get by on Social Security and Medicare. They have already paid their dues."

Another solution? "If far-right conservatives can't listen to reason, maybe they will listen to Ronald Reagan," CNN contributor John Avlon argues.

"Because Reagan had stern words for Congress when it tried to play political games with the debt ceiling in 1987. They still ring true today...," he wrote before quoting the late president's exact words. "Congressional Republicans should read that paragraph (from Reagan's speech) out loud twice before going to vote on the debt ceiling in the next few days. It is essentially the same argument Obama has been making. But in our current hyper-partisan environment reason doesn't resonate across party lines. Instead, there is too often an overheated impulse to oppose Obama at any cost. Hearing the same argument from the Gipper might inspire a needed sense of perspective."

Candy Grossi has someone else in mind that Congress should call for help. She said she is weary of the “Washington political game playing” because she doesn’t think that politicians really care what average Americans have to say.

Her advice to Washington? Enlist the help of people who are used to balancing their household budgets.

“Advice for Washington: Bring some normal housewives who have to really work a budget, putting food on the table ... ," she told iReport. "Maybe then our budget will get in line. We need people who don't have any special interest. We need people who really care for the good of our nation, which means our people (all of us).”

CNN also asked former officeholders for their views on how to resolve the debt crisis. What do they think should happen?

Former Sen. Arlen Specter of Pennsylvania said he thinks Obama should hold in reserve the prospect of using the 14th Amendment to get around the debt ceiling.

“This extraordinary assertion of executive authority could be justified because the Congress has, in effect, abdicated its constitutional responsibility to agree on legislation through the bicameral conference before the drop-dead date leaving a vacuum which must be filled if the government is to function,” he said.

Ex-Reagan budget director David Stockman said, “The crisis lies in the debt, not the ceiling. Kicking the can with a six months' ceiling increase is the worst possible alternative because it allows the politicians of both parties to continue making the big fiscal lie.”

Former Sen. John Danforth said the real issue is the size of government. He urges Congress and the president to agree on raising the debt ceiling and to make the 2012 election a vote on the size of government - between Obama’s plan for a government that spends nearly 24% of the gross domestic product and Rep. Paul Ryan’s plan for a smaller government, amounting to about 20% of GDP.

“The appropriate size of federal spending as a percent of GDP will not be resolved by politicians without input from the American people. In other words, it will not be decided before the 2012 presidential election,” Danforth said.

Meanwhile, iReporter Valerie Bass, a Middleburg, Florida, teacher and the wife of an Afghanistan veteran, offers this advice to Congress: “This is not a game. Cut the benefits the politicians have as we can't afford them.”

Bass has a lot more to say in her impassioned iReport:  "My husband lost his health and his ability to have a normal life due to his deployment to Afghanistan. We also have two children in college and are counting every penny. We have given our future and our health for this country. We are the military families!"

Who's to blame for the debt-ceiling crisis?

Fareed Zakaria calls the government impasse a self-created crisis, saying the damage is already done.

"My basic point is that this is a crisis that we have manufactured out of whole cloth. We have created a circumstance in which the world doubts our credibility, rating agencies are thinking of downgrading our debt and the dollar's role as the world's reserve currency could be jeopardized," Zakaria writes. "Please understand that none of these things are happening because the United States is running deficits. There was no indication - by any metric - that the United States was having difficulty borrowing money one month ago. In fact, the world has been lending money to the United States more cheaply than ever before.

"We face downgrades and investor panic not because of our deficits but because we are behaving like deadbeats, refusing to pay our bills, pouting while the bill collector waits at the door."

Many iReporters said they are sick of the politics behind the crisis and want lawmakers to put aside their differences and just solve the economic problems.

Steve Rokowski said he is tired of elected officials “hiding behind statements” about how the American system of government works. Those elected officials are the most to blame, according to Rokowski.

“Compromise is essential to get things done," Rokowski told iReport. "We all have to do it daily in our lives; it’s more important for Congress as their decisions are supposed to be for the greater good of the country. Stalemate is not an option. I am tired of our government officials always hiding behind the statements that, 'This is the system our forefathers have put in place.' They didn’t set up a government that was this dysfunctional.”

Who's winning this fight?

Lawrence R. Jacobs, a professor and director of the Center for the Study of Politics and Governance at the University of Minnesota's Humphrey School of Public Affairs, takes a look at the implications across the board and who could walk away a winner or a loser in this war over the debt.

He said that Americans are turning against the GOP in the debt debate because of the party's insistence on cutting government programs only without any tax hikes. And Democrats are winning the argument on Medicare and Social Security. Obama also has a lot at stake here. His talk about the inability of government to get anything done implicates him, too, Jacobs argues. Any talk of a dysfunctional government is hurting his cause, he writes.

"The president's flagging of Washington's 'dysfunction' reinforces the distrust of government that many Americans harbor, oddly making it harder for him to rally support behind government programs such as Medicare and Social Security," he writes. "This may help to explain why the GOP is losing the debt-ceiling debate and yet three-quarters of Americans favor a constitutional amendment to balance the budget."

He adds, "The lessons moving forward are clear. Republican leaders intent on winning the White House and strengthening their position in Congress need to steer their party back to the views of mainstream America or squander what may be setting up as a propitious opportunity in 2012 to run against the 'in' party in a time of deep discontent. As for Democrats, they need to focus like a laser beam on the concrete programs that many Americans rely upon and steer away from the sweeping conclusions about government waste and dysfunction that undergird a genuine philosophical conservatism in America."

But Jeffrey Miron, author of "Libertarianism, from A to Z," writes this public spectacle is a blemish on both parties in part because neither side will concede on their big issues. Democrats won't accept that Medicare is the primary driver of the fiscal nightmare, he argues, and Republicans won't distinguish between two kinds of tax revenue - that from higher tax rates and that from fixing tax loopholes.

"Will the Democrats and Republicans be able to set aside their prejudices?" asks Miron, a senior lecturer and director of undergraduate studies in Harvard University's Economics Department and a senior fellow at the Cato Institute. "Alas, both parties are doing what their respective constituents seem to want, so compromise will not come easily.

"But something must change, and soon. Otherwise, nothing will stop the U.S. fiscal train wreck."

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Filed under: Budget • Economy • Finance • Politics • Taxes
soundoff (1,803 Responses)
  1. fred

    Do you really think any of this panicked "the sky is falling" bs being pushed by both sides is real, or is it another way for politicians of all stripes to take money from the poor and give to their rich supporters... all the while convincing Americans that they must to do this because of the "emergency".

    July 29, 2011 at 2:25 pm | Report abuse |
  2. James Martin

    NO ONE in Congress gets paid till the debt ceiling is passed. In fact, they should be penalized a month's pay for every day that goes by with no debt ceiling increase. End of problem.

    July 29, 2011 at 2:25 pm | Report abuse |
    • Joe

      Great idea!! I was thinking the same thing last night.

      July 29, 2011 at 2:40 pm | Report abuse |
  3. Rich

    "Every major bill should be posted online and publicly available for at least 72 hours."

    – John Boehner

    July 29, 2011 at 2:25 pm | Report abuse |
    • Cherries

      I TOTALLY AGREE. At the end of the month, I know where all of my income dollars went. I would like to know where (specifically) where my tax dollars went, too.

      July 29, 2011 at 2:30 pm | Report abuse |
  4. Howdy Doody

    It does not matter in the slightest where the American public "stands" on anything- ANYTHING. Americans are given two fake parties that have local or community connections anymore to chose from and they differ only in surface rhetoric and cultural symbols.

    Only when Americans turn off their TeeVee's and emerge from their entertainment caves and actually talk to their neighbors about REAL ISSUES- will anything change. But I don't see that happening anytime soon. Welcome to Feudal America.

    July 29, 2011 at 2:26 pm | Report abuse |
  5. liz

    Obama has been spending irresponsibly since he was elected, ignoring those who protested and knew his spending was unsustainable. Now he wants to pass the burden to the working class with more taxes. He talks about personal responsibility and bipartisanship but does not practice it. Unbelievable arrogance!

    July 29, 2011 at 2:26 pm | Report abuse |
    • danojeep

      So I guess the FACT that he inherited the largest deficit in the History of the US to that point means nothing?

      July 29, 2011 at 2:31 pm | Report abuse |
    • Joe

      Only wants to increase your taxes if you make over $250,000!

      July 29, 2011 at 2:31 pm | Report abuse |
    • Stephen Russell

      You are greatly misinformed or sadly, more than likely, choose to ignore the truth and perpertrate a lie. A republican Congress for the 8 yrs of George Bush spent money recklessly on two wars and tax breaks. Also it was Bush who authorized the money to bail out the banks.

      How quickly we forget when Bush took office there was a surplus!!!!! Yes President Obama has tried to spend to get us out of the deep hole Bush left us in, but his actions, to the intelligent and honest observer of Washington politics is not the cause for the mess we are in now.

      July 29, 2011 at 2:36 pm | Report abuse |
    • Larry L

      Certainly you must have the ability to grasp obvious concepts – the economy was broken when Obama took charge and the spending was an effort to save what was left of our economy! Most economists agree that without stimulus spending we could have nose-dived into a deep depression. Who cut the revenue by lowering taxes? Bush. Who started two wars and never even counted the costs as a part of our budget? Bush. Who released the first bailout money for the financial markets? Bush. Which political party produced no ideas to help fix the problem? Republican. Do you see a pattern here? Sadly, I doubt that you do...

      July 29, 2011 at 2:38 pm | Report abuse |
  6. Bennett Brachman

    Congress MUST do their job and stop acting like children. Spend your energy in creating jobs.

    July 29, 2011 at 2:26 pm | Report abuse |
    • Cherries

      First thing though, evaluate HOW we got into such debt in the first place.

      July 29, 2011 at 2:29 pm | Report abuse |
    • Joe

      The "R's" can't possibly work on job creation, they are way to busy working on anti abortion, voter suppression and anti public union legislation. The "R's" want the government out of their lives unless it is to get involved in one of these three, then government involvement is fine.

      July 29, 2011 at 2:35 pm | Report abuse |
  7. walter

    The only reason the debt is under discussion is because the Tea Party stood in the way of "business as usual". While I do believe they could have compromised by now, somebody needs to stand for what's right. Repubs and Dems haven't yet. Right now,the Tea Party seems to be the only ones with integrity even if you disagree!

    July 29, 2011 at 2:26 pm | Report abuse |
    • Dan - Phx

      Integrity??? You mean naiveté!

      July 29, 2011 at 2:33 pm | Report abuse |
  8. Chuck

    Most government spending goes right back into the economy. Probably 1/3rd of you wouldn't have jobs right now without government contracts. Do you really understand what you're asking for when you talk about cutting social security, SSI, etc? I agree that there is some waste, but the bulk of government spending is for good causes that are needed to protect the security and integrity of the United States.

    July 29, 2011 at 2:26 pm | Report abuse |
  9. Janie

    This wasn't a crisis until Republicans decided to use the opportunity to politicize something that should have been routine. Now they've pushed an opportunity to embarrass the President so far that they've genuinely put our financial reputation at risk. Why any human would vote for another Republican after this needless display of juvenile petulance and defiance, I have no idea.

    July 29, 2011 at 2:26 pm | Report abuse |
  10. Dick N. Bush

    End the wars, bring the troops home, cut the budget of the CIA, NSA, and DBI by 75%, end the TSA, scrap the President's fleet of jets, bar Michelle from eating lobster, and cut the salaries of Congresscritters by 50%. Then we can talk about raising the debt ceiling.

    July 29, 2011 at 2:26 pm | Report abuse |
  11. arron belmont

    they need to raise taxes on the rich and big businesses
    cut the fat and live medicare and medicaid and S.S. alone
    those people are suffering enough

    July 29, 2011 at 2:27 pm | Report abuse |
  12. Cherries

    I would like to see a breakdown of what the debt consists of. How much was spent on salaries, maintenance, nasa, defence, foriegn aid, domestic aid: welfare, social security, and education. Which one takes up the most of our money? Does anyone know where this information is available?

    July 29, 2011 at 2:27 pm | Report abuse |
    • LD

      Does it really matter at this point where it was spent? Our government has run a deficit 60 of the last 72 years. This isn't something new. Not every person collecting SSI is broke but every one of them has benefitted from years of overspending and everyone of them has had the opportunity to vote for their representatives. Nothing should be off the table.

      July 29, 2011 at 3:00 pm | Report abuse |
  13. Joe

    I think if the "tea party" tank the ceiling increase the first cuts should be all the districts represented by the tea party congress members. I'm sure they will be willing to suspend their SS checks to back their tea party principles.

    July 29, 2011 at 2:27 pm | Report abuse |
  14. Sallie

    I am disgusted. The US is now the laughing stock of the world and the financial markets are in turmoil. If elected officials are looking for good ways to get voted out of office, this is it. For every person who is currently in office, consider yourself warned that you will get few votes, and don't come around begging for campaign donations so you can waste taxpayer funds and time putting on Capitol Hill Theater.

    July 29, 2011 at 2:27 pm | Report abuse |
  15. Sharon

    It seems like the dems don't like any plan, and certainly do not want to compromise. I believe they are hoping they can hang this on the republicans so they can have this blame for the next presidential election. Let's faced it, Mr. Obama already has stated no new taxes, and here he is again, going against his own words and forgetting them. More taxes is not the answer, never has been. All these social programs that the liberal dems love to finance is the problem...the elephant in the room.

    July 29, 2011 at 2:28 pm | Report abuse |
    • Krb

      These aren't taxes, he merely want to close corporate loop holes, oil companies do not need $5 billion dollars in subsidies. Clinton left $238 billion surplus, Bush left us $5 trillion in debt. Social programs have nothing to do with this mess. Your ignorant about this problem, or all you watch is Fox news.

      July 29, 2011 at 2:35 pm | Report abuse |
    • Joe

      Even Waren Buffet and the founder of Home Depot believe they should be paying more in taxes.

      July 29, 2011 at 2:45 pm | Report abuse |
    • Joe

      I'm trying to get the elephant out of my life but it wont cooperate. I'll begin to help it out of the room next November

      July 29, 2011 at 2:47 pm | Report abuse |
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