Senate Attempt To Block Debt Ceiling Increase Fails: Debt Target Is Now $15.2 Trillion, Or Over 100% Of GDP

Tyler Durden's picture

Earlier today we observed that absent immediate action by the House and Senate to enact the critical $500 billion debt ceiling expansion, the US would run out of Keynesian dry powder as soon as Monday. There is no longer a need to worry. According to the Hill, an attempt to sabotage the bankruptcy of America has failed after a Senate resolution to disapprove the $500 billion debt ceiling increase proposed by Mitch McConnell was voted down 45 to 52. As a reminder, "Under the debt-ceiling agreement reached in early August, the Obama administration was authorized to immediately raise the debt ceiling by $400 billion. Another $500 billion increase was authorized this month, although that could have been blocked if both the House and Senate approved resolutions expressing disapproval." The opportunity cost of passing the bill would have been an additional 10 hours of work tomorrow for the Senatorial millionaires for whom insider trading is legal: "Earlier in the day Senate Majority Leader Harry Reid (D-Nev.) threatened to hold the Senate open for up to ten hours on Friday to "dispose" of the resolution if it moved forward." As a result of this vote, a parallel bill in Congress is now moot even though it has not been voted on. This effectively greenlights the increase of the US debt ceiling from the current $14.694 to $15.194 trillion, or roughly 101% of GDP.

Some more:

On Thursday morning McConnell suggested senators could use the vote as a way to respond to President Obama's "jobs" speech to a joint session of Congress in which he presented a proposal that he said would stimulate the  American economy.


"After the president's speech tonight calling for more stimulus spending, the Senate will vote on his request for an additional $500 billion increase in the debt ceiling," McConnell said. "So senators will have an opportunity to vote for or against this type of approach right away."


A House Republican resolution has also been introduced, H.J.Res. 77, that has the potential to pass if most Republicans decide to support it. Still, House passage would not be enough to stop the $500 billion increase in the debt ceiling since the Senate stopped it.


The House resolution, from Rep. Tom Reed (R-NY), has 49 cosponsors, all Republicans.


The House and Senate resolutions are identical, and read:


"Resolved by the Senate and House of Representatives of the United States of America in Congress assembled, That Congress disapproves of the President's exercise of authority to increase the debt limit, as exercised pursuant to the certification under section 3101A(a) of title 31, United States Code."


The Senate adjourned at 8.31 p.m. and is set to return on Friday at 9:45 a.m.

Congratulations America: you just bought yourself 3 more months.

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DaylightWastingTime's picture

dear governmant, thanks for sparing me from a dry fuck, and your spit on a magnetic strip, at least i retain my dignity in a long line. but always i give freely of the unmentionable freely, as long as you continue to end the friction of living in a world i fucked up,  becuase of course i fucked it up, wish i had at least 2000$ then we wouldn't have this conversation out loud but thankfully i am one of 43%, the line is long. and my voice is growing hoarse. i want to work, or rather i would prefer a different species of work one, that asks for more than nothing but i want to keep my teeth in this nipple. i still love you no matter what.

DaylightWastingTime's picture

dear governmant, thanks for sparing me from a dry fuck, and your spit on a magnetic strip, at least i retain my dignity in a long line. but always i give freely of the unmentionable freely, as long as you continue to end the friction of living in a world i fucked up,  becuase of course i fucked it up, wish i had at least 2000$ then we wouldn't have this conversation out loud but thankfully i am one of 43%, the line is long. and my voice is growing hoarse. i want to work, or rather i would prefer a different species of work one, that asks for more than nothing but i want to keep my teeth in this nipple. i still love you no matter what.

max2205's picture

Wow, while you were sleeping... In the dead of night.... Where are the fucking tea baggers ?

UGrev's picture

Got cold cocked on this one.. didn't even know about it.. but I'll be making some noise tomorrow. 

docj's picture

There are, like, what, 6 maybe 7 legit "Tea Party" votes in the Senate (I think that's how many voted for Rand Paul's budget - and at least one of them, Hatch, did it just to try to keep from getting primaried next year). This outcome was priced-in weeks ago.

MFL8240's picture

The criminals are out of control, goodbye to America as we know it.  The US fool stood before America tonght with more spending ideas and not one accoplishment to his name.  Why would anyone listen to this clown?

andybev01's picture

Because they are having a hard time getting to sleep?

alien-IQ's picture

America has proven, once again, that it can out banana any banana republic on earth.

King_of_simpletons's picture

Who cares about the debt ceiling anymore... Spend man.... Keep spending into oblivion.

Atomizer's picture

Burn baby Burn. Enron.

Reportedly, George Kasier has been producing high levels of Co2 in his underpants.

Somehow, we need to work off Solyndra's inventory of photovoltaic solar cells. Some green nut job can figure out how to retrofit those batteries into our existing electrical grid source/Chevy Volt.

BTW..I was a vendor, unharmed thankfully. They immediately ramped up with CTP after new building went 80% online. Another company affected,

FBI clean sweep operation today was to protect a fraud in office.

Jacob J. Lew, Director

IMPACT: OMB dodges subpoena deadline on Solyndra

Tonight Obama spoke without his Gibson guitar. Folks, his next media event will have the teleprompter playing softly in the background..

Immigrant Song - Led Zeppelin 

Without the new participants to invest into SS & Medicare program, the Ponzi myth will be exposed.

More taxpayer funded shell company laundering will come into exposure.

 Calgon "Ancient Chinese Secret"


knukles's picture

See!  Fixed again. 
A real bi-partisan solution in the True Keynesian Kumbayahian manner.
Yidju get that early tee time for tomorrow at Congressional, Joe?

razorthin's picture

I was discussing with the some of the smartest people I know about the indemnity of Congress against insider trading laws.  Their jaws dropped in disbelief.  It's appalling that almost no Americans realize JUST how bought and paid our "representatives" are.

Someone should remind the congressional assphucks that they can also SHORT.  That would be the most beneficial self-enriching thing they could do for their country.

chump666's picture

The August 'chaos' trade will come back with a vegenace.  Obama has set up a fight with the Republicans.  His tax BS was never planned to be passed, he wants to get a public backlash going against the majority of congress.

The mind boggles how close everything is to the edge and that a-hole is about to tip it over.

Markets trading in narrow ranges, there is not going to be a major bull market here, no way...back to extereme swings in bull/bear trades.

Bad vibes man

floyd084's picture

Im sure you guys all know where to look, but here it is for those that dont (table iii-c). That 400 billion sure went fast.


Setarcos's picture

I OBJECT to the constant reference to Keynes.

He would be rolling in his grave to see what has gone on since everything he stood for got obliterated from the late 1970s.

He NEVER endorsed deficit spending with money borrowed (at compound interest) from private banks ... writ large in the Fed.

He would never have agreed with the Chicago School ... if you do not know what that produced, e.g. Greenspan and all current mainstream economic theories, then more fool you.

Does any reader of this know the difference between fiscal policies and monetarist ones?

In any case what Keynes advocated was taxing and saving during good times, so as to be able to spend the savings during bad times.

Shame that few have actually read J M Keynes, or at least J K Galbraith.'s picture

But Keynes would print money, stuff it into jars and bury it under tons of garbage in abandoned coal mines so that people could have jobs digging it out. What a guy.

Calculated_Risk's picture

The fact that he thought a politician could save money says everything I need to know about the man.

centerline's picture

If I recall correctly, Keynes was a proponent of socializing losses as spreading out the impact of malinvestment is easier (kinder) than letting smaller groups of people fail more catestrophically (Austrian school of thought).  Is interesting that we are up against this very subject now.  Yeah, Keynes never imagined what has been created - a true MMT abortion that is built to fleece.  But, it appears a key flaw was the failure to recognize that debts do in fact matter, because they serve as a wealth transfer mechanism from the masses to the financial elite (those who are closer to the creation/control of a currency).  Damn human behavior getting in the way of all that fancy math.  Go figure. 

Libertarian777's picture

actually you have a point there.

Austrian school of thought is you don't need government regulation, market regulation will make malinvestment die a horrid death.

Keynes as you indicate, says socialise losses to 'save' those who malinvested. Which is why we end up in economic malaise (like Japan).


Still waiting for Krugman to explain why Japan's tsunami + QEn  hasn't doubled the Japanese GDP this quarter.

Goldman Hufs's picture

You've posted this garbage before.  No government in the history of the world has ever "saved during the good times."  The fact that his policies hinged on this idiotic concept ensured that they were doomed from the start.  He's either incredibly naive or a criminal but either way his policies have significantly contributed to the mess we are in today.  Go back to grading papers for you econ professor.  The rest of us don't want to hear it.

kito's picture

You obviously havent looked into chile

Fiat2Zero's picture

You are the ultimate chile troll. I think you made Simon cry just now.

Goldman Hufs's picture

No, I must admit I have not allocated a lot of my free time researching an economic power house like Chile.

spankfish's picture

I have a friend who is married to an absolutely smoking hot Chilean woman from Santiago. Now thats the type of import I could live with.  I think I'm supposed to say "hot Latin bitchez" now.  Done.

gwar5's picture

Namesakes of Marx and Stalin were also invoked in some tragic undertakings. No pun intended. 

You're right, but the trouble is that the people doing the damage are the ones calling it Keynesianism. Romer even dragged out her Keynesian economic books to Bill Maher to defend what she did. Keynes started with a gold standard but his long term vision was, indeed, for total fiat and that's what we have.  He knew it would lead to expansion of government spending, that's why he did it. It made deficit spending and Central Bank usury respectable. 

Bill Maher: How uncontroversial is Keynesianism?

Christine Romer: "What we did was all from documented research and standard economics text books."   


How about Neo-Keynesianism







FreedomGuy's picture

That's not completely true. He would have endorsed deficit spending in the short run, but with the idea to repay it in good times. He also believed in government controlling the "commanding heights" of an economy which is why statists love him. It is the essential part of any centrally planned economy. We are in a political centrally planned economy now. Each year increases government controls.

However, I do agree that Keynes would not have put us directly in the huge long term debt situations that characterise the entire western world and Japan.

Dr. Acula's picture

Who gives two shits what Keynes would have done. He's a pseudoscientist through and through.

Read Hazlitt's "Failure of the New Economics" for a thorough (sometimes paragraph-by-paragraph) debunking or Keynes' tangled fallacies.

Belarus's picture

Oh...that's why Gold and Silver are down in Asia trading. We're gonna try to spend another $400 billion on another failed policy with money we don't have on top of the whooping $13 billion in planned future spending increased cuts for next year as they allow the credit card limit to be raised without so much as a burp in Congress while we were already gonna run $1.5 trillion in unfunded deficts for 2012.....

It all makes so much sense. Fiscal discpline bitchez.

Belarus's picture

And let's not forget, sands gold and silver, futures are loving this shit. 

Belarus's picture

....Will end up be a +3% day tomorrow for the markets. 

ArkansasAngie's picture

Washington needs to be gutted.  Every last one of them.  Republicans and Democrats.

The very idea that they snookered the American people again is flat unacceptable.

The name of the game has become how do we stop them. 


Zadok's picture

@ ArkansasAngie

Apparently someone else had the same idea a long time ago.  Judges 3:21-22

Bicycle Repairman's picture

"they snookered the American people again"


bid the soldiers shoot's picture

Anybody getting snookered, make sure he's wearing a love glove.

mynhair's picture
Ceerist, now we will get 4 days of not blaming Mooslims.

It's why I like Palin. She hunts moose.

Zadok's picture

I have not commented often but have read much...I am going to throw this into the ring.  

It seems laughable to realistically push for eliminating the Federal Reserve in the face of the contextual circumstance.  Here is why...

Right in principal, wrong in timing...We need the right response at the right time to get the right result, otherwise it just gets worse.  

While I appreciate the anti-Federal Reserve push by what still seems to be a ridiculously small group of people, it seems far too late to effectively matter.  

Go Ron Paul but perhaps at this point it would be better to go for the opposite just to push it into the ditch to get it over with and put something better together...however...

Observation tells me all I need to know about why we are here and why it will not change.  Ignorance and laziness in the face of institutionalized theft are appalling and prolific.  You have to go far and wide just to find someone with enough about them to even be interested in being educated regarding what is causing them so much pain.  

Agreed, the Federal Reserve may be gone in 18 months or a bit more but it will not be because of the success of Ron Paul or a movement, it will be because they have done their job in it's entirety.  If the Federal Reserve went away today, the net effect would be for naught because it is too late.  Keeping the Bernanke lying some more merely directs the implosion and delays the ignorati a bit more.  

Unfortunately observation and experience tells me this tragicomedic horror story will get far worse.  It will be replaced with the next Ponzi scheme but this will embrace the entire world.  This looks to me like the last naked dash to the finish where it really doesn't matter if you yell the truth at the top of your lungs, it will not effectively change the outcome anyway.  

Bottom line is that I see a global fiat currency (not sound money) being issued likely within a couple of years as a replacement for the failed (by planning and subtle execution) national currencies and the existing system.  The path to that looks painful and the Ponzi implosion from the systemic fraud the new system will build in will likely not take very long.   

If this push had come 15 or 30 years ago, we might have had a chance but it looks like it will play out in a tragic human disaster until the King returns.  

So, there you go, a summary of my thoughts, have at it fight club...


Belarus's picture


Excellent contrarian view. And not a bad one at that. Vote for Obama so he can re-elect Ben and Timmy (If he hasn't gone to Goldman by then) and this will hasten the day.....

Smart move. I'll think about it. Long Obama to get the reset sooner? 

CompassionateFascist's picture

Take a long look at the 2004 US election map. Intensify to get 2012 result: Perry with 3 million+ popular vote margin, but Zero nips thru in the EC by a handful of electoral votes. Civil War by March, 2013. Maybe sooner, if Ponzi economy collapses before the election.  

Shirley Wilfahrt's picture

Sure....right after the NASCAR race....I hear Taylor Swift is fucking Katy Perry's dad these days....


I think you are badly underestimating the capacity of the typical American to be completely oblivious to getting dry fucked in their collective fiscal ass.

I think the vast majority of Americans are fucking sheep.... that would have be lying in a ditch with their fucking heads cut off before they realized they were duped.

It is the only logical explanation as to why the USA is now nearly completely broken.

Americans are stupid.

Cheers Bitchez.


fxrxexexdxoxmx's picture

The vast majority of Americans are not stupid. If that was true, one would have to conclude that the public education system was stupid. Trillons of dollars have been spent by the Dept of Education and they continue to be funded. Why would anyone in power allow a system to spend that much money only to produce stupid citizens?

Barrack Obama has a degree from one of the finest examples of the American education system. You are not calling the President stupid are you?

That is racism.

Shirley Wilfahrt's picture

It is by the goodness of God that in our country we have those three unspeakably precious things: freedom of speech, freedom of conscience, and the prudence never to practice either of them. 
Mark Twain 

blunderdog's picture

I don't think it's quite that bad.  You've got to assume that a lot of people who have been fucked the most, and are probably going through a painful awakening process, are effectively homeless by now.

Not "homeless" like those alcohol addicts under the bridge, but "homeless" like "moved a few hundred miles to live with friends/relatives while getting shit together" kind of homeless.

What percentage of the poor/working-class who are living through the current economic shitstorm are going to VOTE? 

How could they if they wanted to?

Our turnout has always been abyssmal, and there's no reason to expect that to change.

Shirley Wilfahrt's picture

If voting changed anything, they'd make it illegal.
Emma Goldman

bid the soldiers shoot's picture

Emma Goldman or Emma Lazarus?

"Give me your spoiled, your rich,
Your huddled golfers in a summer rain,
The well-dressed reflet from Armani’s teeming store,
Send these, the time shared, and vacation homed abroad,
I lift my lamp beside the golden door.”

bid the soldiers shoot's picture

So you don't buy "we're out of oil' flapdoodle?

Anyways, what's the difference if they herd you into the cattle car for hyperinflation or for peak oil? In a couple of weeks you'll be minced and grilling on a rich person's Weber.

Shirley Wilfahrt's picture

Every normal man must be tempted, at times, to spit on his hands, hoist the black flag, and begin slitting throats.
H. L. Mencken