What’s the Significance of the Debt Ceiling in the U.S.?

There’s a lot of confusion about the debt ceiling.  As the limits are set through Congress and when an increase of the ceiling is required, the U.S. government sometimes goes into partial shutdown while debate rages over it being raised.

Here’s a video explaining the debt ceiling. Although it’s accurate, additional background may be required to understand how this gets a little more complex when party politics takes over and each side attempts to usurp the role of the other.

What we need to understand are the rules set forth through the Constitution concerning the separation of powers. The Executive branch of government, which is led by the President and the Legislative branch, composed of two houses of Congress, the Senate and the House of Representatives. Each have their duties. Spending gets altered when for example, the executive branch decides to create law by fiat. We’ve learned about repeated modification through executive orders on the health care law. Deadlines and requirements have changed and among other things, this changes government spending. Congress has ineffectively attempted to thwart these changes through limiting the increase on the debt ceiling.

Ultimate responsibility for setting the budget is through both houses of Congress. When they fail to complete an annual budget, then the government runs on an autopilot, led by the President. Spending limits aren’t observed and we continue to increase debt.

As an informed electorate we need to be aware that if a political party is pointing the finger at the other, there’s likely a shared responsibility not being met. Rather than assume that responsibility, because this creates a re-election problem for the party’s, the process has focused more on assigning blame than fixing the problem for excess spending over what has been collected through taxes.