You may recall dire warnings from the White House about failure by Congress to approve an official new national debt ceiling. Not providing the government with new borrowing authority once the current limit is reached would "plunge the world economy back into a recession," President Barack Obama said a month ago.
For months analysts have predicted the current
$14.3 trillion debt limit would be reached by the middle of this month. Last week they became more specific, saying it probably would happen Monday.
Did it? Well, yes and no. Department of the Treasury officials said the ceiling was breached Monday. Actually, the nation passed $14.3 trillion in debt on April 15.
And guess what? Whether you use the April 15 date or give government estimators a break and call it Monday, virtually nothing happened.
Treasury Secretary Timothy Geithner insists that is only because of emergency action he took during the weekend. In order to pay the government's bills, including interest on the debt, Geithner will borrow money from pension programs serving federal retirees. At some point the cash will have to be paid back into the pension funds.
Using the pension money will extend until Aug. 2 the date by which Congress must approve a higher debt ceiling to avoid catastrophic consequences, Geithner told reporters.
We presume Geithner has known about the pension borrowing scheme for weeks, if not months. Yet his boss, President Obama, has continued to use the $14.3 trillion ceiling as a prod to accuse fiscal conservatives of risking another recession.
Meanwhile, neither liberals in Congress nor the White House have offered any sort of formal plan to reduce spending in connection with a debt ceiling increase. Conservative lawmakers have proposed several deficit reduction plans.
This is not the first time Obama has used brinkmanship - with an artificially created claim fiscal disaster is looming - to avoid agreeing to spending cuts. We doubt it will be the last. Aug. 2 is not that far away, after all.
But thoughtful Americans are beginning to see through the president's "sky is falling" claims. In their minds, it is long past time for him and liberal lawmakers to tackle the real brewing storm - runaway government spending.