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Market Takes Leg Lower As Treasury Supports Use Of "McConnell Provision" In Debt Ceiling Fight

Tyler Durden's picture




 

As the Fiscal Cliff discussions get progressively more acrimonious, more people are being reminded that the new and improved $16.4 trillion debt ceiling, which the US will breach in a few days, is just as important, and just as much at an impasse. Which is why the Treasury just opined on the issue, by openly supporting the "McConnell Provision" and in doing so may have made any future Cliff/Ceiling discussions more difficult as the US has effectively invoked the nuclear option, aka a Presidential Veto to effectively elimiante the debt ceiling, something which will antagonize the GOP to such an extent any potential Fiscal Cliff deal may become unfeasible.

From the Treasury's blog:

The Budget Control Act enacted in August of 2011 included a provision, authored by Senate Republican Leader Mitch McConnell, that provided for expedited votes in both houses of Congress on legislation to disapprove debt limit increases requested by the President. Congress could block an increase in the debt limit via enactment of the disapproval legislation. However, if disapproval legislation was not enacted, the requested debt limit increase took effect. The debt limit was increased three times pursuant to Senator McConnell’s mechanism.

...

The McConnell Provision was designed to preserve the authority of Congress to disapprove increases in the debt limit, while at the same time making it possible for needed increases in the debt limit to take effect.  The Administration supports extension of Senator McConnell’s mechanism in order to prevent a repeat of the 2011 debt limit ordeal and to ensure that the threat of default does not put the U.S. economy or the creditworthiness of the United States at risk in the future.

The market is hardly happy that the already record polarity in Congress is about to get even worse as a result of this hardline stance, and just took another big leg lower.

 

From The US Treasury's blog:

Taking the Threat of Default Out of the Debt Limit

On Sunday, December 2, Secretary Geithner appeared on NBC’s Meet the PressCBS’ Face the Nation, ABC’s This Week, FOX News Sunday, and CNN’s State of the Union and made the case for the Administration’s balanced approach to reducing the deficit and strengthening economic growth.

Along with this balanced plan to reduce the deficit, Secretary Geithner indicated that the Obama Administration supports extending the “McConnell Provision” regarding the debt limit -- a part of last year’s Budget Control Act:

Secretary Geithner on Meet the Press: “We made a very sensible suggestion, and let me describe what that is.  What we propose to them is they extend what’s called the McConnell provision.  This was a solution Senator McConnell offered last summer, which was enacted -- summer of 2011 -- which was enacted into law, supported by Republicans.   And the way that works is the President would have the obligation periodically of requesting an increase in the debt limit, and then Congress would have the chance, then, to express its views on the merits of that proposal by disapproving that. And then the President would have to decide, if a bill came to his desk, about whether to veto that or sign it.   Of course, he’d veto it in that context. And the virtue of that mechanism proposed by Senator McConnell, a man of impeccable conservative credentials, is to make sure that the country is not left at risk of periodic threats of default.   It’s a very good idea.   It was a Republican idea.   And we’re suggesting they extend it.”

The McConnell Provision received broad bipartisan support last year. In fact, it was one of those rare policy proposals that received support from both the Wall Street Journal and New York Times editorial boards.

And for good reason. Extension of the McConnell Provision would lift the periodic threat of default from the U.S. economy and remove politics from future debt limit debates, while preserving Congress’ essential role in spending, revenue and borrowing decisions.

Under the McConnell Provision, Congress would retain its authority to disapprove any increase in the debt limit.  In fact, the provision was specifically designed to permit increases in the debt limit only after both houses of Congress were given the opportunity to vote on whether to approve or disapprove any increases.

Extending the McConnell provision would not permit the executive branch to spend money or collect revenues without prior congressional approval. Indeed, the debt limit does not authorize new spending commitments; it simply allows the government to finance existing legal obligations that Congresses and presidents of both parties have approved in the past.

Background on the McConnell Provision 

The Budget Control Act enacted in August of 2011 included a provision, authored by Senate Republican Leader Mitch McConnell, that provided for expedited votes in both houses of Congress on legislation to disapprove debt limit increases requested by the President. Congress could block an increase in the debt limit via enactment of the disapproval legislation. However, if disapproval legislation was not enacted, the requested debt limit increase took effect. The debt limit was increased three times pursuant to Senator McConnell’s mechanism.

How the McConnell Provision Works 

A congressional debt limit disapproval process consists of the following steps:

  • Once the debt subject to the statutory debt limit is within $100 billion of the limit, the President may request an increase in the debt limit by sending a written certification to Congress that the outstanding debt is within $100 billion of the debt limit, and that further borrowing is needed to meet existing commitments. 
  • Congress has 15 days to deny the request, through enactment of a Joint Resolution of disapproval.
  • In both the House and the Senate, consideration of the Joint Resolution of disapproval is governed by expedited procedures.
  • If both Chambers pass the Joint Resolution of disapproval:
  •  
    • It is sent to the President for veto or signature.
  •  
    •  
      • If the President vetoes the Joint Resolution, the Joint Resolution is returned to Congress.
  •  
    •  
      • If the President’s veto is overridden by Congress, which requires a 2/3 vote of each Chamber, then the debt limit increase request is denied.

If a Joint Resolution of disapproval is not enacted within 15 days then the debt limit is increased pursuant to the President’s certification.

Summary

The McConnell Provision was designed to preserve the authority of Congress to disapprove increases in the debt limit, while at the same time making it possible for needed increases in the debt limit to take effect.  The Administration supports extension of Senator McConnell’s mechanism in order to prevent a repeat of the 2011 debt limit ordeal and to ensure that the threat of default does not put the U.S. economy or the creditworthiness of the United States at risk in the future. 
Jenni LeCompte is the Assistant Secretary for Public Affairs at the U.S. Department of the Treasury
 

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Wed, 12/05/2012 - 11:56 | 3035767 TruthInSunshine
TruthInSunshine's picture

Paging Timmmmmmay "The U.S. Will Never Be Downgraded" Geithner. Maybe the 2nd time will be the charm (not).

Wed, 12/05/2012 - 12:04 | 3035810 icanhasbailout
icanhasbailout's picture

Boehner just punked himself in a big way. He just did a purge of fiscal conservatives from committees to help push through a deal with the admin, and to his great surprise only did the Obama admin react with the most hardline stance it had available.

Wed, 12/05/2012 - 12:16 | 3035852 Bananamerican
Bananamerican's picture

"aka a Presidential Veto to effectively elimiante (sic) the debt ceiling"

Gold (not Goldman) Bitchez!

Wed, 12/05/2012 - 12:31 | 3035924 MillionDollarBogus_
MillionDollarBogus_'s picture

The Dems should just say no to anything McConnell proposses...

Wed, 12/05/2012 - 16:00 | 3036214 SafelyGraze
SafelyGraze's picture

warning: adult-rated conversation snippet

readers offended by pillow talk should stop here.

--

bo: you want more?
sheep: no

bo: I like it when you say no
sheep: please stop

bo: did you say 'harder'?
sheep: that hurts

bo: louder, sheep
sheep: enough

bo: that's better
sheep: ouch

bo: ouch *what*
sheep: ouch .. sir?

bo: that's more like it
sheep: no .. stop .. ouch ..

bo: that's what I want to hear
sheep: help

bo: put this on
sheep: please no 

bo: that's right, sheep .. beg for it
sheep: make it stop

bo: what kind of music do you like 

 

Wed, 12/05/2012 - 12:04 | 3035812 holdbuysell
holdbuysell's picture

US(A)

Wed, 12/05/2012 - 12:21 | 3035882 common_sense
common_sense's picture

Afraid of fiscal cliff??  Why??  Bernike , Berny, is printing money, printers are ok, working hard, but still working. And if printers are ok, employment is safe.... so, everything ok. Capitalism is easy, easy, problems are solved printing money, i dont see any problem in capitalism. Rich people are getting richer, and poor people are getting poorer, so everything ok. Capitalism is nice. Only if you are rich, of course. For the rest, we are full of shit, but nobody cares, so, capitalism is really nice. And capitalism is only possible with politiciens, of course. Capitalism without politiciens wouldnt be capitalism, it would be too much nice...

Wed, 12/05/2012 - 12:12 | 3035840 Slewburger
Slewburger's picture

What a joke. The time period of these requests by fearless leader will decrease until he is granted ability to do so without Congress.

Right now its like a 60 Hz AC power supply, Obama is going DC bitchez!

Wed, 12/05/2012 - 12:56 | 3036064 NotApplicable
NotApplicable's picture

You have to admit, they're doing a fine job of navigating us over the falls (as in, nothing seems to weird to consider anymore given the circumstances).

Never mind the rocks below. They won't hurt. Honest!

Wed, 12/05/2012 - 13:24 | 3036184 ElvisDog
ElvisDog's picture

It took me awhile to understand what this was all about, but if I understand correctly as long as the Dems control at least one house of congress the president can increase the debt limit any time he wants by as much as he wants. Is that correct? Because unless both houses of congress deny the request it goes through. Why doesn't Obama request a $6T extension of the debt limit and then he doesn't have to worry about it again for the rest of his 2nd term.

Wed, 12/05/2012 - 13:37 | 3036230 youngman
youngman's picture

6 Trillion....I bet he hits that in 2014

Wed, 12/05/2012 - 22:15 | 3037953 StychoKiller
StychoKiller's picture

"Giving money and power to politicians is like giving whiskey and the car keys to teenagers!" -- P.J. O'Rourke

Wed, 12/05/2012 - 12:38 | 3035981 dadichris
dadichris's picture

the sooner the better for downgrade in my book - just perpetuating a corrupt power structure

Wed, 12/05/2012 - 13:27 | 3036196 ElvisDog
ElvisDog's picture

But with the Federal Reserve buying up 60-70% of all new debt issuance, what effect does a downgrade have? The Fed is not going to let a downgrade change its course of action. Face it, with the debt ceiling limit a non-factor with this McConnell ammendment we are going down the deficit-spending path for as long as we can. And in my opinion, it will be years before anything breaks down.

Wed, 12/05/2012 - 11:57 | 3035776 DoChenRollingBearing
DoChenRollingBearing's picture

Why can´t everyone see that it´s the spending stupid?!

Sometimes I get the feeling that our public servants do not serve us...

Wed, 12/05/2012 - 12:02 | 3035799 Augustus
Augustus's picture

Everyone does see that.

The pols particularly know that it is the spending that gets the stupid to vote for them.

Wed, 12/05/2012 - 12:07 | 3035819 TomGa
TomGa's picture

Only sometimes ??

Wed, 12/05/2012 - 12:09 | 3035830 Toolshed
Toolshed's picture

"Sometimes I get the feeling that our public servants do not serve us..."

Sometimes? Is that subtle sarcasm? The only time our "public servants" serve us is on that rare occasion when their interests align with ours. You know, like during the run-up to an election.

 

Wed, 12/05/2012 - 12:58 | 3036073 NotApplicable
NotApplicable's picture

And even then they're feeding you your own ass.

Round Steak, it's what's for dinner.

Wed, 12/05/2012 - 12:15 | 3035848 forwardho
forwardho's picture

Everyone KNOWS its the spending. They don't know what to do with all the PEOPLE that money is spent on.

47 million starving ex-foodstamp participants, 67 million ex-S.S. retirees,.....Ad infinitum.

If the money train stops, this game is over. They will not stop till far, far beyond the end of the tracks.

Wed, 12/05/2012 - 12:36 | 3035972 viahj
viahj's picture

but don't forget the MIC, foreign aide and interest on the debt...all huge ticket items

imagine a huge mil downsizing and bringing home a lot of battle hardened troops with no jobs, they are not that stupid.

Wed, 12/05/2012 - 12:31 | 3035930 game theory
game theory's picture

Public "servants"...it is such a misnomer. Real estate in DC in 2012 is in a fresh bubble...which is a result of DC sucking all the cash away from everyone else in the country to prop us their lifestyles.  And defense contractors have accelerated the pulling of jobs back to VA and MD from other states because they need to keep their crony friends satisfied.  The fiscal cliff is a farce.  Politicians will never stop taking money for themselves and their friends...because they are addicts...and there is no way for anyone to stop them.  Only discipline in the debt market will fix things...and that can only happen when the fed chooses to stop manipulating that market. And I don't see that happening anytime soon. 

Wed, 12/05/2012 - 12:45 | 3036016 Money Squid
Money Squid's picture

Public servants work in a system controlled by the same idiots that are causing the problems. How many times have heard about some loser being appointed to a high-level government job for which they have no experiece (Michale "Heckava Job" Brown) only to totally screw the place up? This is by design and that is their function even if the tard that is hired does not know he is a total failure. The best way to prevent governmet oversight is to emplace a total loser who is gauranteed to screw everything up, especially when the idiot has a very high opinion of himself. Let's recall a few names Sara Palin, James Watt, Dan Quale, W., Tim Geitner, Ben Bernanke, Allan Greenspan, Haley Barbour. You will find a total loser is in place just in time to not do something, stop something, or screw something up. Its the best way to get something done, or not, and cover your tracks.

Wed, 12/05/2012 - 13:36 | 3036206 ElvisDog
ElvisDog's picture

Why can´t everyone see that it´s the spending stupid?!

You know why? Because for the moment, Obama is correct. Deficits don't matter, and there are (currently) no consequences from maintaining or increasing the status quo of nice government benefits for almost everyone. The time horizon of the American public has shrunk to the here and now. They support Obama because he is the defender of the status quo.

And much to my surprise, I find myself supporting this approach. I'll use a Titanic analogy. The ship has hit the iceberg and is going to sink no matter what. The ship has promised the passengers free champagne and oysters as long as the ship stays afloat. If you're a passenger on that ship, wouldn't you want to postpone the sinking as long as possible? Wouldn't you want to drink the champagne for a couple more hours before the plunge into the icy ocean.

Wed, 12/05/2012 - 13:32 | 3036212 salvadordaly
salvadordaly's picture

"We all know what to do, we just don't know how to get re-elected after we have done it."

Jean-Claude Junker - 2012

Wed, 12/05/2012 - 12:00 | 3035790 firstdivision
firstdivision's picture

Does this provision also include "buy all FB shares"? 

Wed, 12/05/2012 - 12:00 | 3035792 Al Huxley
Al Huxley's picture

So let me get this straight - this gives Congress the ability to say they 'don't approve of the debt ceiling increase' but then the debt ceiling increases anyway, just without the approval of Congress?  And the main reason to do this is 'the only way to avoid the risk of defaulting on our debt is to be able to perpetually raise the debt ceiling (but with Congress' disapproval!)'?  And this is being generally accepted as sound and valid reasoning by political pundits MSM and the general public? 

Wed, 12/05/2012 - 12:08 | 3035824 supersajin
supersajin's picture

The ultimate shell game!

Wed, 12/05/2012 - 13:00 | 3036084 NotApplicable
NotApplicable's picture

Well, as we all know...

They have to do SOMETHING!!!

Never mind the fact that it is pure plundering.

Wed, 12/05/2012 - 13:56 | 3036319 OneTinSoldier66
OneTinSoldier66's picture

Al,

 

It's so hard and weird to even try and explain it. But I'd say you did a pretty good job. It's just that when trying to explain, a person could end up looking like you'r avatar before, during, and after, the explanation.

Wed, 12/05/2012 - 12:08 | 3035825 fonzannoon
fonzannoon's picture

I hope no one lets this guy get involved. I will leave him nameless because I don't want him dragged into it.

"The fact that we're here today to debate raising America's debt limit is a sign of leadership failure. Leadership means '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."

 

 

Wed, 12/05/2012 - 12:13 | 3035842 SheepDog-One
SheepDog-One's picture

Gee it sounds almost like the Monetizer in Thief himself Barry Soterro!

Wed, 12/05/2012 - 12:19 | 3035865 Everybodys All ...
Everybodys All American's picture

El Presidente  Zero

Wed, 12/05/2012 - 12:49 | 3036032 Grinder74
Grinder74's picture

BUCK FARACK

Wed, 12/05/2012 - 12:01 | 3035796 lolmao500
lolmao500's picture

Yeah we're only talking NOW about the debt ceiling, but since august 2011, Obama lifted it TWICE by himself because of this rule.

This rule is total garbage and gives more power to the executive.

Wed, 12/05/2012 - 12:19 | 3035869 Al Huxley
Al Huxley's picture

I think you're missing the important point that, even though the debt ceiling increases in perpetuity, it does so with congressional disapproval.  So that makes it ok and not dangerous at all. 

In fact, picking up this line of reasoning has reduced my stress in a lot of areas.  For example, I used to worry about the negative impact excessive alcohol consumption might have on my health, but since my wife regularly registers her disapproval of this, that removes any risk of negative impact, and I can safely drink as much as I want.

Similarly, she can run up her credit card debt as much as she wants, and as long as I register my disapproval, it's all good.  I haven't run that one by the bank yet, but I have to assume that if it works for the govt it should work for me too. 

Wed, 12/05/2012 - 12:01 | 3035797 casey13
casey13's picture

No debt ceiling. Money printing forever. GO TO US CASH and BONDS? 

Wed, 12/05/2012 - 12:21 | 3035876 Bananamerican
Bananamerican's picture

yeah, take one for the team, Casey....

Wed, 12/05/2012 - 12:02 | 3035802 Cognitive Dissonance
Cognitive Dissonance's picture

I support the Tyler provision. Remove the Ponzi supports and see what floats to the top.

<Or sinks to the bottom. Might get a wee bit crowded down there.>

Wed, 12/05/2012 - 12:10 | 3035832 zendome
zendome's picture

Right, just flush the damned toilet already!

Wed, 12/05/2012 - 12:33 | 3035953 Money Squid
Money Squid's picture

a lot of people will be sucked under by the massive current from the collapse. Even if they have the ability to float on their own it will take time for them to free theselves from the down current and all the debris on top of them. When there is a collapse there is a lot of collateral damage.

Wed, 12/05/2012 - 12:06 | 3035803 Stuart
Stuart's picture

Treasury wants to eliminate the debt ceiling,..... and gold is hit again.....  Seriously, except for a handful of people, is there no frickin' intelligent life left on this planet that can grasp the consequences of such a move on the need to continue printing money...?????  Gold should be soring..

Wed, 12/05/2012 - 12:07 | 3035822 yogibear
yogibear's picture

It's being manipulated. You can bet there are big buyers waiting at lower price levels waiting to buy everything in sight. They know what it means.

Wed, 12/05/2012 - 12:25 | 3035895 stormsailor
stormsailor's picture

gold will never "soar".  it can be manipulated and shorted with an infinite trading account.  i believe the only reason it has risen since 2008 was to soak up some of the money supply.  it moved from 480 to 1700 in 4 years, but hasn't moved since.

 

Wed, 12/05/2012 - 12:38 | 3035982 robertocarlos
robertocarlos's picture

If I didn't buy it at $750, why would I buy it at $1750?

Wed, 12/05/2012 - 12:46 | 3036018 Al Huxley
Al Huxley's picture

Yeah, hang onto that line of reasoning.  In an environment of negative real interest rates, perpetually increasing government government debt, and increasingly blatant outright monetization of said debt, the last thing you want to be holding is gold. 

 

Hey, I heard the FED's going to be buying ALL the 10 year issuance now!  Can you imagine what the corresponding shortage in supply to the market will do to the price of USTs?  They're going to the fucking moon man!  Buy all you can now while they're still available, before the FED gets them all!

Wed, 12/05/2012 - 13:05 | 3036097 BraveSirRobin
BraveSirRobin's picture

Maybe gold is getting hit because central banks are dumping due to liquidity problems? Or, they just want the cash. Anyone know who is selling?

Why would they do this? If we are nearing the end of the economic rope, and the central banks realize they cannot print anymore (it would be due to measures of self-interest the prohibits new monetization), then the big deflationary slump sets in, and cash becomes king, and everyone needs to raise cash to pay creditors, meaning they sell anything (includiong precious metals) so they can avoid insolvancy and handing over their assets to the banks.

I know this goes against the grain of what the central banks have been doing. They have been bailing out the financial institutions (in the US case, that means the FED is bailing out its member banks, a clear conflict of interest), but there could come a time when the paradigm shifts, and the adverse prospect of more monetization outweighs the benefits of deflationary collapse. Or, maybe, there comes a time when deflationary collapse is preferable.

When could this be? When they have enough cash on the sidelines to buy up everything at the bottom. Everyone sells - they buy. What the insolvent can't sell, the banks take possion of. Then they own it all with phantom money previously greated from nothing.

Wed, 12/05/2012 - 12:04 | 3035809 Banksters
Banksters's picture

Congress and the Senate can suck on their own cocks and clits.    

 

This fucker is going down, the cast is set.

Wed, 12/05/2012 - 12:57 | 3036067 Grinder74
Grinder74's picture

Actually, she can suck mine and I'll suck hers.

en.wikipedia.org/wiki/Kristi_Noem

Wed, 12/05/2012 - 13:10 | 3036120 stormsailor
stormsailor's picture

would a lot rather get trapped in the elevator with republican ladies of the house than democrats.   one could be a wet-dream, the other a traumatic nightmare.

Wed, 12/05/2012 - 12:04 | 3035813 yogibear
yogibear's picture

And Goldman told it's clients to sell gold. With an unlimited credit card Obama and the democrats go on spending spree. 

You thought $16 trillion was a lot. You haven't seen anything yet.

Wed, 12/05/2012 - 12:22 | 3035884 surf0766
surf0766's picture

I hear $777 trillion was planned.

Wed, 12/05/2012 - 15:03 | 3036584 BraveSirRobin
BraveSirRobin's picture

All you gold bugs are getting punked! The central banks are setting you up for a fleecing. You are convinced they will inflate until Hitler reappears, but what they are really doing is creating hordes of cash for themselves from nothing, and will yank away the supports and cause a massive deflationary depression. So, when you scamble and sell everything to save your butt during the panic and collapse, they will use all that cash to buy up everything (including your gold and silver) on the cheep, when "blood is running in the streets," as they say.

Look at the trillions the banks and big corporations are hording in cash.

Remember, you are the little guy, and you WILL get screwed. Bend over and learn to love it, bitch.

Wed, 12/05/2012 - 12:05 | 3035815 Toolshed
Toolshed's picture

Looks to me like the Republicans were overconfident, even then, of getting back the White House in 2012.  On the other hand, since in reality, we have a one party system like China, it effectively REMOVED the debt ceiling for all practical purposes.

Bullish!!!!.............for PMs anyway. I just hope they keep beating the prices down so I can buy more.

 

Wed, 12/05/2012 - 12:05 | 3035816 SeverinSlade
SeverinSlade's picture

Eliminate the debt ceiling?  Will that finally trigger a mass US downgrade by the big 3?

Wed, 12/05/2012 - 12:06 | 3035818 lolmao500
lolmao500's picture

Under the McConnell Provision, Congress would retain its authority to disapprove any increase in the debt limit.

Bullshit. There's no way congress would be able to get 2/3 of the votes to stop Obama from lifting the debt ceiling.

Wed, 12/05/2012 - 12:30 | 3035920 Money Squid
Money Squid's picture

The statement is correct in that Congress would retain its authority. It states nothing about the possibility that Congress could get 2/3s of its members to agree on anything, but the option is there. Its all a word game. Its just a  big game.

Wed, 12/05/2012 - 12:37 | 3035977 pods
pods's picture

In reality they aren't following any of the other rules that we the people have set up for them.
I say set the printer to plaid and let it blow.

Fuck em, people have always been able to conduct business under the radar.  

If our nation was a horse, it would have "Elmer's" stamped on the side of it.

Let's just get it over with.  

pods 

Wed, 12/05/2012 - 12:07 | 3035820 Dr. Engali
Dr. Engali's picture

Just get rid of the fucking debt ceiling charade...the market will ultimately determine whether or not we can take on more debt. I say let them spend like there is no tomorrow and get it over with.

Wed, 12/05/2012 - 12:09 | 3035829 SheepDog-One
SheepDog-One's picture

 

'Let them spend like theres no tomorrow?'

Well wholy fuck what the hell have they been doing for the last 4 years if not spending like theres no tomorrow? What have they loaded us with, at least $40 trillion in bailouts?

Wed, 12/05/2012 - 12:13 | 3035845 Dr. Engali
Dr. Engali's picture

Spend more...fucking drop the shit out of the helicopters and watch people go insane. Spend! Spend! Spend!   Fuck I don't care any more. Print eleventy trillion Bernanke bucks and buy Russia or something....fucking spend it.

Wed, 12/05/2012 - 13:16 | 3035932 Bananamerican
Bananamerican's picture

maybe there is no tomorrow...

Wed, 12/05/2012 - 12:24 | 3035893 BurningFuld
BurningFuld's picture

You're catching on. Just more political theater for the masses.

Just to recap...by putting in a provision to stop debt increases it gives the president cart blanch to do debt increases.  Just in case anyone was confused on the issue.

Wed, 12/05/2012 - 12:36 | 3035968 Dr. Engali
Dr. Engali's picture

I'm catching on? I can assure you that at 50 years of age I've been on to their game for quite some time now.

Wed, 12/05/2012 - 12:43 | 3036007 viahj
viahj's picture

Congressional Electoral Deniability

Wed, 12/05/2012 - 13:18 | 3036154 ZackAttack3
ZackAttack3's picture

You read my mind.  There is no debt ceiling in actuality.  There is just a monthly/bi-monthly reminder of how much and how fats the US spends money that it does not have.  Sooner or later, Obama and his administration will make the public forgot about this and seem it unamerican to not spend less than the previous month.

Wed, 12/05/2012 - 12:07 | 3035821 SheepDog-One
SheepDog-One's picture

These idiots have loaded up a double barrel shit machine gun and the barrel is pointed right at their own heads! Double Barrel Shit Machine Gun - YouTube

I tell you what, all you geniuses can have fun front running these maniacal lunatics all you like, I'm nowhere near any of this and very glad of it!

Wed, 12/05/2012 - 12:08 | 3035823 Cursive
Cursive's picture

These are not grown ass men.

Wed, 12/05/2012 - 12:18 | 3035828 TomGa
TomGa's picture

Platinum cards for every Gov't worker!  And don't worry about keeping receipts. It will all be printed, er, paid for.

Wed, 12/05/2012 - 12:33 | 3035943 pods
pods's picture

You get a black card, and you get a black card, and you too get a black card.

Black cards for everyone!

pods

Wed, 12/05/2012 - 12:11 | 3035834 ThaBigPerm
ThaBigPerm's picture

So here we are ... bills no longer passed by Congress and signed into law by the President, no.  Now the President issues edicts, either directly or via "regulation" in the bureaucratic, administrative superstate, and one must muster a 2/3, veto-proof majority in both houses to disallow the implementation of the edict.  Or, said another way, the President makes the law but Congress can (maybe) veto, but only with a 2/3 majority in both houses.  Nice.

Ah, the good ol' days...

http://www.youtube.com/watch?v=VxT7QjlvDqM

Wed, 12/05/2012 - 12:16 | 3035855 SheepDog-One
SheepDog-One's picture

Even the illusion of a 'representative govt' are now long gone, this is now basically 1960's USSR. They just do what the fuck they want now, although they are still bothering with a bit of lame puppet show for general public consumption.

Wed, 12/05/2012 - 15:10 | 3036625 BraveSirRobin
BraveSirRobin's picture

Yes, amazing. The Republic is fading away. An ulitmately, if congress disapproves by a two thirds majority, and the president ignores them, what is congress going to do about it? Who executes, or fails to execute, the law? Obama has already ignored law and court oders, openly, with impunity. Ultimately, this is the great flaw in the system.

Wed, 12/05/2012 - 12:11 | 3035836 NEOSERF
NEOSERF's picture

If eliminating my debt ceiling means that I can simply borrow from any bank at any time via an ATM for any amount with no expectation of repaying it then bring it on...honestly though the debt ceiling while good theatre every year has outlasted its usefulness...there are no decisions that even seem to slow down spending anymore so let the Cristal flow...its 1999 again

Wed, 12/05/2012 - 12:14 | 3035846 optimator
optimator's picture

If they didn't spend all that time on raising the debt limit they'd spend the time on spending even more...

Wed, 12/05/2012 - 12:15 | 3035847 zendome
zendome's picture

As always, follow the money.  Congress, and the Admin, shouldn't be allowed to do anything until the plug is pulled on unlimited and dark campaign contributions.  Until that happens we don't know who they are working for, but it sure as shit isn't for We the People.

Wed, 12/05/2012 - 12:16 | 3035850 Pooper Popper
Pooper Popper's picture

The Dogs of war cometh!

Wed, 12/05/2012 - 12:16 | 3035851 Pooper Popper
Pooper Popper's picture

The Dogs of war cometh!

Wed, 12/05/2012 - 12:16 | 3035853 Catullus
Catullus's picture

Wait, the president can veto a Congressional disapproval of his request for an increase debt limit? Is this not patently insane? Honestly, the colonists had greater say over the governor of the colony during British rule.

And the fact that they use McConnell's name tells you everything you need to know about "compromise". It means you have no leg to stand on.

Disband the republican party already. It represents nothing.

Wed, 12/05/2012 - 12:18 | 3035864 SheepDog-One
SheepDog-One's picture

Exactly, there's still some veil of illusion kept up today but we're basically East Germany now.

Wed, 12/05/2012 - 12:32 | 3035933 Catullus
Catullus's picture

I'm waiting for both sides to recruit some 8 year old to be their spokesman so that they can have an actual child's voice to their childish arguments. "Nuh uh, you never said I couldn't. You're not the boss of me. It's not fair!"

I think there's a really simple definition of totalitarianism. It's when there's no limit to government. This is not fully authoritarian yet. For that to happen, the president just needs to decide that he doesn't need to ask anyone if he can do anything. We're only 75% of the way there. Fully totalitarian, 75% authoritarian.

Wed, 12/05/2012 - 12:17 | 3035860 Super Broccoli
Super Broccoli's picture

Man that system's brilliant ! When do we apply this to speed limits ? No more tickets, the limit rise along me going faster !

Wed, 12/05/2012 - 12:18 | 3035862 grunk
grunk's picture

Legislation this convoluted involves secret handshakes, decoder rings, dungeons, men dressing up like women, and human sacrifices.

Wed, 12/05/2012 - 12:20 | 3035875 Inthemix96
Inthemix96's picture

Heres a puzzling thought boys and girls,

Why, way back when, when the national debt had reached 1 trillion, did no-one turn around and say, "here folks, we are up to the eye balls in debt to the tune of 1 trillion quid.  Should we do something about it?".

Why now?  Why, with 15 more big ones tacked on will they do something?  They wont.

Really, prepare accordingly.

Wed, 12/05/2012 - 12:29 | 3035901 cranky-old-geezer
cranky-old-geezer's picture

 

 

Debt ceiling is a joke. It's a political ceiling, nothing more, no legal teeth, congress could ignore it just like they ignore lots of other fake limits on their actions.

What would happen if congress simply ignored the debt ceiling? 

Nothing would happen.   No court would intervene to enforce it, nobody would intervene to enforce it.

Markets wouldn't care either.  They know it's a joke.

We're on the way to $20 trillion govt debt.  When we get there what will happen?

Nothing will happen.  It'll head on toward $25 trillion.

Wed, 12/05/2012 - 12:51 | 3036043 stormsailor
stormsailor's picture

yep,  and the kabuki theater continues,  entertainment for the masses, the one's who think they are intelligent.  howling laughter in the night

Wed, 12/05/2012 - 12:31 | 3035926 robertocarlos
robertocarlos's picture

"finance existing legal obligations" free shit is an existing legal obligation?

Wed, 12/05/2012 - 12:48 | 3036027 stormsailor
stormsailor's picture

brilliant,  its like real time 3 stooges.  thats the funniest information i've ever heard.  hahahahahhhahahahahahahahahahhaahhah.

 

i'm batshit crazy, by the way

Wed, 12/05/2012 - 12:49 | 3036034 SheepDog-One
SheepDog-One's picture

And now 'markets take a leg higher' to counter leg lower as Monetizer in Thief opens yap.

Wed, 12/05/2012 - 12:52 | 3036048 stormsailor
stormsailor's picture

as if you thought it wouldn't?

Wed, 12/05/2012 - 12:59 | 3036081 SmoothCoolSmoke
SmoothCoolSmoke's picture

St. Ronald Reagan raised the debt ceiling, 18 TIMES!

Wed, 12/05/2012 - 13:03 | 3036095 Racer
Racer's picture

The Dictator is now fluffing up his feathers prior to abandoning any attempt at disguising the fact he is one

Wed, 12/05/2012 - 13:05 | 3036103 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

This is the opposite of how the WH and Congress are suppossed to work. 

This is almost funny.

Wed, 12/05/2012 - 13:09 | 3036115 blunderdog
blunderdog's picture

Way to go, Mitch!

Wed, 12/05/2012 - 13:26 | 3036192 MyBrothersKeeper
MyBrothersKeeper's picture

My question is:  If you campaigned on raising taxes to cut the deficit and the debt and you believed in your plan, why in the world would you seek unilateral discretion on raising the debt ceiling??

 

Wed, 12/05/2012 - 14:40 | 3036429 OneTinSoldier66
OneTinSoldier66's picture

Because you didn't plan on cutting any spending. You might have said you will make some cuts to the future growth in spending that has already been planned for, but you never said you'd make any real actual cuts. Simply slowing down the already planned future growth in spending is not real actual cuts in spending!

 

If you do not raise the debt ceiling then the skimming off the top, the milking of the system, the "free money", would come to an end. You're not campaining on that are you!?!? If you are, then you're Ron Paul!

 

It should be obvious to everyone by now that yes, there is a Santa Claus and there is Free Money. You do not need to ever work, or pay taxes, or any such thing. That working and paying taxes was all just an illusion that representative democracy got right to work on, and fixed it right up. All you have to do is vote, and your free. You can move freely about onto an airplane when you want to travel, and you are entitled to a check from the Government that you gave your labor to and entrusted to keep for you decade after decade, because they never spend your money, they only save it for you.

 

Oh, I forgot. That "free money" only comes from "the rich". I forget that once in a while. They were blessed with it. It just dropped out of the clear blue sky upon them for no reason. So, all we have to do is get them to pay a little bit more. We just need a little bit more "free money" from them. It doesn't cost society or anybody anything as long as we get it from "the rich".</sarc>

Wed, 12/05/2012 - 13:37 | 3036229 Lord Koos
Lord Koos's picture

Antagonize the Republicans?  Oh heavens no...

Wed, 12/05/2012 - 14:13 | 3036382 IamtheREALmario
IamtheREALmario's picture

What ever happened to the congressional super dooper committee?

Wed, 12/05/2012 - 14:44 | 3036504 OneTinSoldier66
OneTinSoldier66's picture

It had a Super Wipeout, which was just a planned part of the show. The entertainment show that keeps making it look like the Government might still one day make some real actual spending cuts. HAHAHAHA! It's a real hoot!

Wed, 12/05/2012 - 14:14 | 3036383 Winston Churchill
Winston Churchill's picture

In that case we may as well just cancel the pantomime show in DC.

Send them all home, and stop paying them anything.

Wed, 12/05/2012 - 14:32 | 3036453 earnulf
earnulf's picture

It's not the fall off the Fiscal Cliff that I'm worried about.

 

It's the sudden fiscal stop at the bottom.

Wed, 12/05/2012 - 14:50 | 3036541 OneTinSoldier66
OneTinSoldier66's picture

I don't understand why anyone would be afraid of such a thing. You think all this "Free Money" spending is helping?

 

Just let it crash already so we can FINALLY clear out all the dead wood laying around!

Wed, 12/05/2012 - 14:32 | 3036454 earnulf
earnulf's picture

doublepost

.

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