Will the Debt Ceiling Rise by $1.2 Trillion?

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January 23, 2011

Will the federal deficit increase even more in 2012? This question remains a topic of debate for many politicians in Washington this month as President Obama announced the need to raise the debt ceiling by another $1.2 trillion. According to a January 12, 2012, article by David Lawder for Reuters, President Obama sent a message to John Boehner (R-Ohio), the House of Representatives Speaker, stating that more money would be needed to “meet existing commitments.” If this proposal passes, then the total nation debt would surpass the $16 trillion mark.

As stated in the article, there is very little time for lawmakers to vote against Obama’s proposition, thus preventing a similar crisis that nearly brought Congress to default in the summer of 2011. However, many Republicans see this proposal as a chance to present Obama as an economic squanderer and hopefully dampen his chances of obtaining a second term in office. From the article:

“The President’s runaway borrowing threatens the foundation of our economy and the financial future of every hardworking American,” said Senator Jeff Sessions, the top Republican on the Senate Budget Committee.

 

The debt limit increase by President Obama was originally planned to occur in December, yet officials asked him to wait until Congress came back into session in 2012. To continue funding the “existing commitments,” the Treasury Department has had to pull money out of Exchange Stabilization Fund and might have to take other measures until the new debt ceiling is established. Lawder also states that the debt limit has “increased by $900 billion since last summer’s debt brawl to $15.194 trillion.”

Teachers could use this article to discuss with students the need to increase the federal deficit ceiling. Some questions to consider: What are the “existing commitments” President Obama speaks about? What federal programs might experience cuts for this debt increase? What programs might receive more funding? How does this increase impact the local and state levels of government? To what extent does this debt increase influence American foreign trade and humanitarian policies? Students should look at President Obama’s proposal from a variety of perspectives in order to better comprehend how the raising of the debt ceiling impacts local, state, national, and international spheres.

Students could also see how President Obama presents this topic during his State of the Union on January 24, 2012. How might he put forth this idea to the American people? What do political commentators say about it after the address? Listening to a range of viewpoints should allow students to see how complex the issue of increasing the national debt is to media and political outlets.

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