We all remember the high-profile political war last year over raising the debt ceiling. It culminated in the Budget Control Act which raised the debt ceiling in 2011 and allowed a second hike in the ceiling in 2012 which could only be stopped if both houses of Congress and President Obama agreed.
Originally these increases in the debt ceiling, totaling over $2 trillion in debt authorization combined, were supposed to get us past election day so that any new hike in the debt ceiling could be taken on by a new Congress, and possibly a new President.
Except, because the economy is performing worse than anticipated, it appears as though another hike in the debt ceiling may be necessary this year. In November, no less, which would put it right around the time of election day.
A new study released on Friday now suggests that slimmer federal tax receipts than anticipated from the sluggish Obama economy along with continued abundant spending by the Obama administration will likely move the date of the next debt deadline considerably forward so that it comes during this fall’s presidential election, with political debate beginning even earlier.
The Bipartisan Policy Center previously predicted the newly-enlarged borrowing limit would not be reached until well into the first quarter of 2013. But no more.
A new examination by the center, as reported in The Hill, now suggests the limit could be reached months sooner, possibly during the election month of November. That means the fall presidential and congressional campaigns would most likely contain highly-charged debt-spending debates in addition to other contentious issues.
This is bad for Democrats for two reasons.
First, their record is so bad on fiscal matters they don’t even want to pass budgets in election years, let alone pass an always-controversial increase in the national debt limit. Senate Majority Leader Harry Reid has said that even if the Senate Budget Committee crafts a budget, he won’t bring it to a vote.
Second, Democrats have been anxious to make the 2012 elections about social issues (witness their efforts to make the Obamacare contraception mandate about women’s health issues instead of economic/religious freedom), but a required debt ceiling increase during the election cycle will throw a monkey wrench in those designs.
If this happen, it will put the fiscal excess of Obama/Democorat leadership on display front and center when most Americans are paying attention.