The Big House Fight to Come Will Be the Debt Ceiling
Commentary
Last week’s struggle in the House of Representatives to select Kevin McCarthy (R-Calif.) as speaker of the House is probably the most contentious House battle most of us will see in our lifetimes. But there is another one coming that is far more important: the battle over the debt ceiling, which will be looming over Congress late this summer or early fall.
Background
The United States is $31 trillion in debt; that’s more than 120 percent of the annual U.S. gross domestic product (GDP). Projections show that spending will exceed revenues by at least $1 trillion per year, every year, for at least the next 10 years. While the debt-to-GDP ratio has decreased from pandemic levels—and the ratio was exacerbated due to the pandemic recession decreasing GDP—it still remains well above pre-pandemic levels—levels that were, even then, historically high. Moreover, neither the debt nor those trillion-dollar a year projections take account of U.S. obligations for entitlements like Social Security and Medicare, which are funded through their respective trust funds and which are also fiscally unsustainable….