Associated Press is reporting that the total U.S. Federal government debt stands at $14 trillion—roughly $45,000 for every man, woman and child in America—and that in order to carry out the fiscal year 2011 budget, Congress will either have to raise the debt ceiling, or cut spending.
Seeing as the FY 2011 budget has a deficit of about $1.4 trillion, there is simply no way that the newly minted Republican Congress will cut spending off the budget so as to keep the Federal budget under the debt ceiling.
After all, what can be cut is discretionary spending—and that includes all of the military spending in Afghanistan and Iraq.
So of course the Republican Congress will raise the debt ceiling. Like the Obama, who in the words of Rachel Maddow “punches the hippy and cuts a deal with the Republicans”, the Republicans in the House are going to have to punch the Tea Partiers and cut a deal with the Obama administration.
Tinny Tim Geithner, our (sarcasm alert! sarcasm alert!) fearless Treasury Secretary, is unfortunately right when he says that any dithering at this point in time insofar as the budget will send shock waves through the markets, and cause another 2008 meltdown.
So regardless of the noise, we here at The Hourly G Command Central predict that the Republican Congress will pass a bill raising the debt ceiling so as to cover the FY 2011 budget.
Expect Republican Congressmen and Senators to be out on the Sunday shows, leaving themselves the door open to cut a deal with the Obama administration.