More Debt Ceiling DA cards Dustin 7-25 Mahoney

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No impact - - even if debt ceiling isn’t passed nothing bad will happen
Marotta 25
(7/25/2011, David, “Hitting the debt ceiling isn’t the end of the world”,
http://www.dakotavoice.com/2011/07/hitting-the-debt-ceiling-is-not-the-end-of-the-world/,
DFerris)

The Obama administration has been claiming that failure to raise the debt ceiling would be the end of the world. We
are all tired of failed apocalyptic predictions. Perhaps all that will end is politics as usual. In 2006 Senator Obama voted against raising
the debt ceiling. He said, “The fact that we are here today to debate raising America’s debt limit is a sign of leadership failure. Leadership means
that ‘the buck stops here.’ Instead, Washington is shifting the burden of bad choices today onto the backs of our children and grandchildren.
America has a debt problem and a failure of leadership. Americans deserve better. I therefore intend to oppose the effort to increase America’s
debt limit.” The speed at which we have increased our debt in the last few years is frightening. The Obama administration added more to the debt
in its first two years than the Bush administration did in its entire eight years. This is clearly a failure of leadership. Just because we reach
the debt ceiling doesn’t mean we have to default on our debt obligations. What it means is that the decision of what gets spent
and what doesn’t will be squarely on the administration. Reaching the debt ceiling only means the money being spent must not be
greater than the money coming in. In other words, we can’t be adding to our debt. It is like members of a family mired in credit card debt
who have reached their $10,000 credit limit. They are not allowed to deficit spend by charging any more on their card. But they still have salaries
coming in. They still are obligated to pay the interest on their debt. And after paying that interest they still have money left over without
defaulting on their debt. It won’t be a catastrophe. It will be forced austerity. The federal government collects about $200
billion every month. Interest on the debt costs less than 10% of that amount. The government could service the debt
and still have over $180 billion to spend on essential services. The administration has the discretion to decide what is essential
without consulting Congress.

Economy collapse inevitable; debt ceiling does nothing
Rampell 7/25
(7/25/2011, Catherine, “On Debt Talks, a Lose-Lose-Lose-Lose Situation”,
http://economix.blogs.nytimes.com/2011/07/25/on-debt-talks-a-lose-lose-lose-lose-situation/,
DFerris)

Almost whatever happens this week with Washington’s debt talks, the economy will likely be worse off. As Dean Maki,
the chief United States economist at Barclays Capital, put it: “The basic issue is that the U.S. is on an unsustainable fiscal track,
which is pretty widely agreed upon. From that point, none of the choices are fun.” Dollars to doughnuts. Here are the
likely scenarios I see: 1) Held up by disputes over how to reduce deficits, Washington doesn’t raise the debt ceiling in time.
As a result, the Treasury stops paying debts it owes. If that happens, the ratings agencies downgrade the United States’s debt. The
cost of borrowing for the United States government shoots up, since lenders demand higher interest rates from borrowers that are less
trustworthy. Many other interest rates are pegged to the cost for the United States to borrow, making interest rates on all sorts of other loans like
mortgages rise, too. Credit markets freeze up, crushing an already-feeble economic recovery. Macroeconomic Advisers predicts that failing to
raise the debt ceiling in time — even if the delay is only one month — will likely result in a new recession. Plus, because it’s more expensive for
the United States to borrow, the United States debt gets even larger, the exact opposite effect that fiscal hawks are hoping for. 2) Held up by
disputes over how to reduce deficits, Washington doesn’t raise the debt ceiling in time. But rather than default on its debt,
it diverts money from other spending into paying back bondholders. That could mean that Social Security checks don’t get sent,
soldiers in Afghanistan and Iraq don’t get paid, and all sorts of other hoary consequences. Plus, bond markets might still freak out because the
threat of default remains, so interest rates could rise anyway and cause all the terrible consequences in Scenario No. 1 (potential second recession
plus even bigger federal debt). 3) Washington comes up with a deal to raise the debt ceiling, but it amounts to less than $4
trillion in savings. Standard & Poor’s has said that just raising the debt ceiling is not enough; without a “credible” plan for at least $4 trillion
in savings, the United States may still have its credit rating downgraded. That could, again, mean higher interest rates and all the other terrible
consequences of Scenario No. 1. 4) Washington comes up with a deal to raise the debt ceiling that amounts to more than $4
trillion in savings,over a near-term horizon. The credit ratings agencies are appeased, but such severe austerity measures put
the fragile economic recovery at risk. The states in particular are anxious about what major spending cuts mean for them, and for the
many social safety net services they provide with federal support. As Bruce Bartlett and others have written, similar fiscal tightening during a
fragile economy happened in 1937. Those actions resulted in a severe second recession and prolonging of the Great Depression, partly
because it was coincident with monetary tightening as well. While a sharp, sudden monetary tightening seems unlikely, the Fed is at the very least
pulling back on its easy monetary policy with the end of its second round of quantitative easing. As The Wall Street Journal’s Kelly Evans
observed, Japan had a similar experience in 1998, when austerity measures were followed by a recession and a widespread sell-off of Japanese
bonds. And even if these likely American austerity measures don’t result in an outright recession, job growth is
already so feeble that most Americans still think we’re in recession. Imagine how terrible things would feel if the economy
slows down even further. 5) Washington comes up with a deal to raise the debt ceiling that amounts to more than $4 trillion in savings, but over a
longer-term horizon. This is the best-case scenario: It deals with the long-term unsustainability of the country’s fiscal arrangements — which is
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good for growth in the long run — but doesn’t rock the boat in the current economic recovery. Unfortunately, it also seems like the scenario that
is least likely to be pulled off effectively. Economists want spending cuts and/or tax increases that come after 2012, when the economy is
expected to be stronger. But to use Standard & Poor’s lingo, cuts that take effect 2012 may not be fully “credible.” Committing to future cuts/tax
increases is just another way of kicking the can down the road, as Washington has been doing for decades now. Almost every time Congress
promises painful fiscal measures at some future date, later politicians jump in to dismantle them just before they take effect. “We do seem to
have a time-consistency problem,” said Mr. Maki. “There does never seem to be a good time for major cuts, and
they’re not going to be more popular five years from now versus now.” So he says that Congress must come up with a way to
prove that these cuts will actually happen versus something that’s on the drawing board and is therefore erasable. Unfortunately, he says,
“There is no way to completely tie the hands of future legislators.”

Obama doesn’t need Congress; he can raise the debt ceiling on his own
Carney 7/25
(7/25/2011, John, “Obama Can Raise the Debt Ceiling on His Own”, http://www.cnbc.com/id/43881701,
DFerris)

If the U.S. defaults on its obligations in early August, it will be because the President chose not to exercise his power to
raise the debt ceiling on his own. The President has it within his power to order the Treasury Department to issue
new bonds to fund current obligations, even if those issuances exceed the debt ceiling [cnbc explains] . “When Abraham
Lincoln suspended habeas corpus during the Civil War, he said that it was necessary to violate one law, lest all the laws but one fall into ruin,”
legal academics Eric Posner and Adrian Vermeule have argued in a New York Times Op-Ed. “So too here: the president may need to
violate the debt ceiling to prevent a catastrophe—whether a default on the debt or an enormous reduction in federal
spending, which would throw the country back into recession.” Their argument doesn’t rest on any contentious reading of the
14th Amendment. Rather it rests on the primacy of the presidency in our contemporary constitutional order. The constitution did
originally set up a system characterized by executive primacy. The legislative branch came first in the original constitutional
order. It exercised all the most important powers, including the powers to raise taxes, borrow money and declare war. The presidency was put
into the position of executing the policies declared by the Congress.
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Failure to pass the debt ceiling bill will cripple the world economy
Bua 7/25
(7/25/2011, Jon-Christopher, “Debt Crisis Warfare”, http://blogs.news.sky.com/washingtonnotebook/Post:bce66e0d-
01ea-4bfb-89eb-945e2287aab9,
DFerris)

Raising the debt ceiling is a routine activity that has occurred approximately 70 times without much ado in Democratic and Republican
administrations alike. What did not need to become a crisis has now become a very big one. And the world is watching. There is an
immediate and very real problem. The US must raise its debt ceiling to avoid the crisis of a default on its existing debt.
To be very clear - the failure to raise the debt ceiling would be nothing short of catastrophic. As is the way of Washington,
there is a difference between political rhetoric and facts - neither party is entitled to its own facts. Despite the messages from both parties some
irrevocable damage has already been done. The world - especially the financial community - no longer believes the US Government functions
properly and may not be able to be trusted to act like responsible adults in charge of the world's most important economy. Clearly further
damage will occur without question if a deal is not reached immediately! If the debt ceiling is not increased and this
"game of chicken" is not stopped, there will be real and measurable consequences for every American and the rest of the
world as well. These devastating consequences are something this administration has failed to make clear. Perhaps it has chosen not
to do so in an effort keep the markets from utter panic. Unfortunately the time may have come for the president to paint a
clear picture for Congress and the American people of what it will be like to fall off the edge of the economic abyss. This just
might be the reality check that Congress needs to get them to act responsibly. Here is what's at stake: 1. The debt the U.S. already has
accrued would become even more expensive to continue to finance. This is like your credit card company announcing tomorrow that your current
balance (not any future spending) - will now cost you 21% interest instead of your current rate. 2. All loans would become more
expensive - possibly intensifying the economic crisis and stopping any recovery. All credit could dry up. 3. The value of the
"Almighty Dollar" will sink - this means that everything the US imports will immediately become more expensive - the price oil and gas will
go up. 4. The stock market would probably take another precipitous dive - the second in the same decade - making it almost
impossible for people's savings and retirement accounts to recover in time for anyone to ever retire. 5. Last, but by no means least, all of this
could precipitate the "Great Collapse" that was narrowly avoided in 2008. This would of course ripple through the world
economy.

Failure to pass the debt ceiling bill will cripple the world economy
MoneyMorning 7/25
(7/25/2011, MoneyMorning.com, “U.S. Debt Ceiling Debate”,
http://moneymorning.com/ppc/GOP_Debt_110718.php?code=X304M722&gclid=CIGC6LnjnKoCFcjAKgodZhIvzg
, ellipses in original, DFerris)

The debt ceiling battle between Congress and the White House has dragged on for months... Now the deadline is only weeks away... and a
serious crisis looms. What would happen if the debt ceiling isn't raised by August 2 and Uncle Sam can't pay its bills?
Major economic catastrophe... including panic in global markets... big losses in stocks, bonds, 401ks and pensions...
a run on the banks... a run on food and gas... and hyper-inflation around the world. It would make the economic
recession of 2007 look like a day at the beach. For these reasons, it's hard to imagine anyone elected to Congress
delaying passage of a bill to increase the U.S. debt ceiling - and protect the world from calamity.

				
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