Entry Submitted by Vee at 11:54 AM ET on May 14, 2023
This is interesting and did not know..(see the highlighted bold text)
Manchin Says Biden ‘Hypocritical’ On Debt-Limit Demands
- Senator Joe Manchin (D-W.Va.) said his fellow Democrat, President Joe Biden, has staked out a “hypocritical” position in recent debates over how to raise the U.S. debt limit.
- Biden has repeatedly called for a so-called “clean bill” to raise the debt limit without any additional conditions on matters such as spending reforms. In an interview with CNN on Tuesday, Manchin criticized Biden’s position.
- “It’s not rational, it’s not reasonable, and it’s not practical,” Manchin told CNN’s Manu Raju.
- Biden and other members of his administration have argued that Republican lawmakers, who are leading the efforts to impose spending reforms, have previously accepted debt-ceiling increases without adding new spending control measures. Manchin argued that the only times there aren’t contentions over a debt-limit increase is when one political party controls the White House and both houses of Congress.
- “It’s hypocritical to say that we’re not going to do it now when we’ve done it every time that there has been a split in the party,” Manchin said.
- Manchin went on to say that it’s “not reasonable” to insist that there be no spending cuts or conditions attached to a debt-limit increase.
- “The Constitution vests in Congress, and withholds from the Executive, the power to commit to spending, to raise revenue by enacting taxes, and to incur public debt. The Fourteenth Amendment does not alter this. Congressional control of borrowing, through the debt limit, and section four of the amendment are in unison, not tension,” the conservative Heritage Foundation wrote in 2011 when Democrats floated the 14th Amendment theory as a way to circumvent a previous debt-limit impasse.
- The Heritage Foundation further argued that a default on the national debt does not actually constitute questioning the validity of the debt. The foundation noted that debtors may commit to repaying a debt even after declaring bankruptcy.
- “Insolvency, in itself, does not impugn the validity of a debt, but only the debtor’s present ability to pay,” the Heritage Foundation added.
How would the U.S. inc..be able to pay on its default..if the system as we know to come would be able to function in the old manner. This makes me believe that there will have to be a Global debt forgiveness. Could this debter commit to repaying its debt ? How ? selling off its assets? Who is liable..the Federal Reserve or the Federal Government, what ever that is.
The Myth of the Debt Apocalypse
- Promissory notes are stacked to the Treasury Department’s proverbial ceiling, $31.4 trillion dollars’ worth of them. Over $5 trillion of those dollars have been purchased and are held by the Federal Reserve bank; meaning the federal financial system, in effect, lends money to itself.
- Because of a statutorily-set debt limit, the Treasury hasn’t be able to borrow more money from itself to fund government operations since January, 2023. To make matters more dire, soon the Treasury won’t be able scrounge any more cash to pay all the bills through “extraordinary measures.” Congress and the President need to find a way to increase the debt limit or default on obligations.
- Treasury Secretary Janet Yellen articulated the situation in a May 1st letter to Speaker of the House Kevin McCarthy:
“After reviewing recent federal tax receipts, our best estimate is that we will be unable to continue to satisfy all of the government’s obligations by early June… if Congress does not raise or suspend the debt limit before that time… If Congress fails to increase the debt limit, it would cause severe hardship to American families, harm our global leadership position, and raise questions about our ability to defend our national security interests.”
- Since Secretary Yellen mentions federal tax receipts, it is worthwhile to note that in Fiscal year 2022 the federal government collected $4.9 trillion in revenue, primarily from personal and corporate income taxes, spent $6.27 trillion, and financed a deficit of $1.38 trillion. This means approximately 22% of government spending was done with borrowed money in 2022.
- It was the borrowed $1.38 trillion that brought the national debt to its “ceiling” and has forced the Treasury to fund government operations through “extraordinary measures.”
- In her letter, Secretary Yellen is unclear about which hardships she thinks American families will suffer if the nation defaults on its obligations. Is it the suffering from the current 4.9% inflation? The collapse of regional banks? The diversion of taxpayer dollars to millions of migrants flowing over the southern border? Or perhaps it’s the tens of thousands dead Americans due to Fentanyl overdoses?
- And what global leadership position is Secretary Yellen worried about losing if she can’t borrow more money?
- Source: americanthinker.com
“$4.9 trillion in revenue” in fiat. Remember..the FRN became nothing but a commodity instrument..after Nixon depeged it from gold. The value was Countries needed to have it.
Counties all over the world are devesting themselves from these-it and via Tresury Securities. This means that there will be so much of these IOU commodity notes everywhere that as we are now seeing via inflation they have become a worthless commodity and much like the German mark after WW1..it will take more of them to buy a loaf of bread. You think the cost of things are rising because of limited Supply? No it’s the worthlessness of those IOU note. No one wants them (Countries). Bananas and coconuts would be better to have. I wish I realized this 20 yrs ago.
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