No Debt Ceiling?
Early this month the political leaders of the U.S. have all but assured run-away inflation in the future. One way that the feckless leaders of Congress, regardless if it is the left or the right, can keep a very loose lid on overall spending of the government is to have a spirited debate on their non-stop increase of debt when it’s time to increase the debt ceiling.
If there was no debt ceiling, and therefore no arguments on controlling spending, whatever little opposition there really is to this profligate spending would fade away. If it ever happened, one could imagine both sides of the political persuasion start to spend more than they ever had before.
And that just may happen!
The debt ceiling debate was just about to heat up as it was needed to be passed by the end of this month, or the U.S. was in jeopardy of defaulting, which would have global repercussions in the financial markets. But two other things happened this month as well: hurricanes Harvey and Irma. Hurricane relief would have been held up by the debt ceiling debate so the Democrats got the president to extend the deadline to early December of 2017. What’s truly odd, however, is then there was talk of simply doing away with the debt ceiling altogether.
As reported by Politico:
In a meeting with GOP and Democratic leaders, in which Trump sided with the Democrats on a fiscal deal to raise the debt ceiling, the president said he believes the votes are unproductive, those people said.
With Congress set to lift the debt ceiling into December as part of the deal, Trump floated the idea that the next time Congress votes to raise the debt ceiling, it could be the last.
He said conversations should happen over the next three months, according to people in the room.
Schumer said such a move could not be accomplished now, but indicated he would talk to his caucus about considering structural changes to the debt limit in December, a conversation Trump supported.
House Minority Leader Nancy Pelosi (D-Calif.) also appeared interested in the deal but was noncommittal. The debt ceiling is a key leverage point for members of the minority, particularly because it can be filibustered in the Senate and require 60 votes.
If this crazy idea passes, spending (read: debt) will skyrocket. It almost seems impossible that president Obama added $10 TRILLION to the U.S. debt in just 8 years with a debt ceiling; however, without a debt ceiling, one can imagine president Trump adding that much in just 4 years!
Over the generations the best defense against inflation, which is caused by run-away government spending, is GOLD! It always has been and always will be. Adding it to your portfolio today is a prudent investment.