Uh...
I’m not so sure you are right. Let’s play with numbers.
Say our debt limit is $1000. We have it maxed out.
Let’s also say I earn $100/mo. And, just for the sake of argument, let’s say that the interest on my $1000 debt is $25.
In August, $400 worth of the principle comes due. OK, fine. I pay out that $400 worth of principle, reducing my total debt by $400. Now I am at $600 worth of actual debt *with a $1000 debt limit.*
It’s a shell game.
It doesn’t matter whether or not you sell NEW DEBT totaling $400 first or second, at the end of the day, you still have $1000 worth of debt. So you can pay that old debt principle with new debt. It doesn’t affect the debt limit.
The revenue still pays the $25 coupon on $1000, leaving $75 surplus for other expenditures.
That won’t work because you’ve spent the principle already. This is what it means to be a deficit economy. You don’t have the money to pay the principle. You have ZERO dollars in you bank. How do you pay the note? You can’t. The USA is BROKE. We live on debt. We have no money in our bank account. You are suggesting we can use check kiting to cover our debts. That’s absurd. Our creditors are not morons. They are very smart German, Japanese, Taiwanese and Chinese people. They are not going to take rubber checks.
All the people calling for not increasing the debt limits are completely warped and stupid. We will be viewed as the equivelent of Argentina. And we will deserve it.
Mitch McConnell is the only person with a brain in the GOP. Thank god he is the head of the Senate.
I love Michele Bachmann, but she and all the other Tea Party Patriots are DEAD WRONG on this issue. We must raise the debt ceiling.
What does being a Conservative mean if not that you pay your debts?
Bolobaby is correct. Paying off maturing bonds with new bonds can be done within the ceiling limit.