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. Dan in Az

    This is a completely manufactured crisis. The GOP overreached in their pursuit of embarrassing Obama, and now it has come back to bite them. They tied the debt ceiling issue to a totally unrelated debate, and now they're stuck with it.

    July 29, 2011 at 1:45 pm | Report abuse |
  2. jessicaber

    I thought that I had posted a comment on here, but now I do not see it.

    July 29, 2011 at 1:45 pm | Report abuse |
  3. Eric

    Seriously, aside from being just a bunch of obstructionist punks on both sides, and worrying only about who is going to come out ahead in the power struggle... just print more money bi.t...s! The US is a sovereign nation and can print money and back it up with the faith of it's word. This alone would divert the debt crisis, and even pay down some debt. Oh and before any of you go and try to tell me I'm full of it, research it first.

    July 29, 2011 at 1:45 pm | Report abuse |
  4. Kam

    Pass legislation allowing the debt ceiling to increase while also requiring a deficit reduction law be passed before 12/31/2011. Allow the world's economy to continue functioning while the fiscal debate rages on.

    In the meantime, give the freshmen republican congressmen some high school level economics textbooks to read up on.

    July 29, 2011 at 1:45 pm | Report abuse |
    • yessir

      I second that

      July 29, 2011 at 1:46 pm | Report abuse |
    • markwchitown

      The freshman Republicans actually read there high school and college economic books. If you had read one you'd realize that no one can agree that raising the debt ceiling is good... doesn't matter who does it, Rep or Dem. Long term unsustainable levels of debt will eventually bankrupt you.

      July 29, 2011 at 2:03 pm | Report abuse |
  5. Harvey Johnson

    Vote Republican in 2012 to end cut SSN, Medicare, Medicad, Veteran Benefits, do away with Pell Grants and any program that might help the MIDDLE CLASS. Vote Republican in 2012 to keep tax loopholes for the wealthy, why should they pay the same percentage as the middle class. The cleaning lady that cleans Warren Buffets office needs to pay more taxes then he does, should have to pay more for health care then he does and she should work until she is 70. The time the Middle class quits getting over on the wealthy. And lets forget about the tax cuts that were in the stimulus that all the republicans forget to mention when they are spewing lies about the stimulus like they did about the death panels. All you who claim to be christians need to look in the mirror explain to yourself how do you vote republican knowing they will cut all the programs that people have paid into but will fight to keep the wealthy from paying their share of taxes and the next time you shake a veterans hand explain how you voted to cut his or hers benefits.

    July 29, 2011 at 1:46 pm | Report abuse |
    • Eric

      ditto raised to the power of infinity.

      July 29, 2011 at 1:49 pm | Report abuse |
    • RUFFNUTT

      Why not throw more money at the Pentagon and increase our foreign aid givaways while we're at it?! That the Republicans are very good at!!! And that cursed Ali Abdullah Saleh of Yemen couldn't be happier with out stupidity at electing these worthless Repblicans along with these "blue-dog" Democrats into office as we're fighting the civil war in Yemen on his behalf!!!

      July 29, 2011 at 1:54 pm | Report abuse |
    • Van in AZ

      Exactly!

      July 29, 2011 at 1:58 pm | Report abuse |
  6. Me

    I read this and just laugh at those who blame Obama for any of this, considering the debt ceiling was raised 7 times while Bush was in office without a thought, almost setting the next president up for failure :/ Obama does NOT want money to end for SS or Military benefits, he's said that because that will be the OUTCOME of nothing happening. My question to ALL politicians is why are WE supposed to make concessions but they NEVER do?

    July 29, 2011 at 1:46 pm | Report abuse |
    • markwchitown

      He is partially to blame for this. He had two years to formally deal with this while he had a majority in both house and senate. Instead they focused on expanding our base line debt with the Presidents health care legislation and other stimulus spending. It's unfortunate we've politicized irresponsible spending by both parties.

      July 29, 2011 at 2:12 pm | Report abuse |
  7. Matt

    I have an excellent idea here. Why don't we just reduce the military spending from the current $783B to just over $300B in just two years? That alone would go a very long way in reducing the national debt. Why are these politicians too stupid to see that? Its beyond me!

    July 29, 2011 at 1:46 pm | Report abuse |
    • MAD

      Why don't we cut money that comes to you ass hole! Would you like that?

      July 29, 2011 at 1:53 pm | Report abuse |
    • RUFFNUTT

      Another ignorant Tea Partier here! Sorry Matt, but these people come pouring out of the woodwork to spew their ignorance on this web page!!!

      July 29, 2011 at 1:57 pm | Report abuse |
    • OnTheTRag

      Matt, the idea is just one of the pieces of the puzzle, but you're headed in the right (or is it left?) direction. MADMoron sounds like a skeered defense contractor flunky. GOPagainstT

      July 29, 2011 at 2:11 pm | Report abuse |
  8. Pete

    I vote for the asteroid solution that took the dinosaurs. H0m0 sapiens is ripe for extinction. myself absolutely included.

    July 29, 2011 at 1:46 pm | Report abuse |
  9. john

    Hurry. Arrest the congressional republicans.
    Remove them from office.
    Quick.

    July 29, 2011 at 1:46 pm | Report abuse |
  10. Shawn Davis

    All I hear is talk about cutting support for old people and the disable, but nothing about the defense budget? Defense amounts to over a third of our total expenditures - cut the military.

    July 29, 2011 at 1:46 pm | Report abuse |
    • Lyndsie Graham

      Excellent idea, Shawn. The problem here is that these worthless politicians work for the MIC(military-industrial-complex) and not us!!! We need to throw these charlatans out of offfice and elect a bunch of moderates in their place but unfortunately, that won't be done any time soon!

      July 29, 2011 at 2:05 pm | Report abuse |
  11. Michael

    Sell all stocks and mutual funds. These fools are going to cause the market to crash. This is what when we vote away our own interest just to make the black guy look bad!

    July 29, 2011 at 1:46 pm | Report abuse |
  12. s kel

    i have been saying that the tea paty is the american taliban for a long time now. i just hope the same americans stupid enough to vote them in last oct are not stupid enough to do the same thing. i dont know a lot of amrican voters seem to vote for the loadest canidate , in other words , stupid votes.

    July 29, 2011 at 1:46 pm | Report abuse |
  13. Steve

    It seems to me that America voted last November to put people in office that would hold this administration to the fire in getting serious about the nation's fiscal responsibilities. Voting to give Obama enough of a debt ceiling increase to carry him through the 2012 elections wouldn't accomplish the mandate. As painful as it is, having to face these issues a couple more times over the next 18 months will keep the government accountable to actually do something to reduce deficit spending and the national debt. Further, we need a balanced budget amendment because it is clear that our government is not able to restrain themselves without one.

    July 29, 2011 at 1:46 pm | Report abuse |
    • Mangusta

      you are absolutely right! We have a long term debt issue. So why not crashing the economy now to address the 10-20 year issue? Sounds like a good idea.. I am thinking now that since I know I am gonna die one day, why not jumping off a bridge today? Great insights!

      July 29, 2011 at 2:02 pm | Report abuse |
  14. chris

    I think it's time for elected officials to only be allowed by law to serve two elected terms. This is why our Country the United States of America is quickly becoming the joke of the world. To many elected officials want to make it a career and only serve themselves rather then the American people. Please, please please, lets teach these do nothings career politicians who live off the backbone of the middle class a lesson and VOTE them OUT of office. It's time to make a stand and two term limits hopefully the people we elect will hard and fast for the people they serve NOT for their own pocket.

    July 29, 2011 at 1:47 pm | Report abuse |
  15. Richard Reynolds

    Republicans (TEA-BAGGERS) say they're only doing this for the good of the country! I wonder what they'd be willing to do if they ever had the notion to do something BAD to the country. Maybe kill the firstborn of every human being suspected of having even a hint of intellectual curiosity. I hope they all choke on their patriotism until they're coughing up lungfuls of Thomas Jefferson's pragmatic ire.

    July 29, 2011 at 1:47 pm | Report abuse |
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