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Politics : Actual left/right wing discussion -- Ignore unavailable to you. Want to Upgrade?

To: TimF who wrote (9968)	7/29/2011 11:12:36 PM
From: Oeconomicus	Read Replies (1) \| Respond to of 10087

Agreed on the first part. Insisting that we will be in actual default on any obligation, not just Treasuries, come next Tuesday without a debt ceiling hike is ignorant blather. Or at least blather that assumes ignorance on the part of the public (which might not be a bad bet, BTW). However, forcing Treasury and the WH to prioritize cash disbursements, shutting off the spigot to roughly 40% of federal spending, would be highly disruptive at best. And unfortunately, due to the short-sightedness of a couple dozen or so members of the House, the GOP is now positioned to shoulder the entire blame for it.

To: TimF who wrote (9968)	8/2/2011 11:09:17 AM
From: Lane3	1 Recommendation Read Replies (1) \| Respond to of 10087

I really wish people would stop calling it "default". Hitting a debt limit != default, anymore than hitting the limit on your credit card means your defaulting on it. As long as you make the payments (and the payments for the feds are a relatively small fraction of their revenue) your not defaulting. Per Webster: Definition of Default 1 : failure to do something required by duty or law There may be enough money to service the debt but there would not be enough money to pay all that the government was obligated by law to pay. To avoid default, the government would have to both service the debt and pay all its other legal obligations. I haven't seen any scenario that would enable it to do that. If your complaint is that people have been saying "default on its debt," you have a point, although there is still some risk. I agree that the rhetoric has been sloppy in this regard and many people may have been left to think that we would automatically fail to service our debt but I disagree that using the word, "default," is necessarily wrong.