Federal debt is crawling ever closer to its $14.3 trillion limit, drawing a warning from the president's chief economist, Austan Goolsbee. If Congress leaves the borrowing cap where it is, he told ABC's This Week yesterday, the United States could default on its current debt obligations and spark economic catastrophe. Goolsbee said a failure to raise the ceiling would mean a "worse financial economic crisis than anything we saw in 2008."
Some conservatives, like Republican Sen. Lindsey Graham of South Carolina, say they don't want the United States to default, but see the debate as an opportunity to bargain: spending cuts in exchange for their support. "I will not vote for the debt ceiling increase until I see a plan in place that will deal with our long-term debt obligations, starting with Social Security," he said on NBC's Meet the Press. He added that he wants to cut discretionary spending levels back to what they were in 2008.
Others, like Republicans Rep. Michele Bachmann from Minnesota and Rep.-elect Mike Kelly from Pennsylvania have said they completely oppose increasing the amount the U.S. government can borrow. Kelly called raising the debt ceiling "absolutely irresponsible," and Bachmann started a petition on her political action committee's website, Michelepac.com, to oppose it. "Congress has had a big party the last two years; they couldn't spend enough money," Bachmann said on CBS's Face the Nation. "And now they're standing back folding their arms saying 'oh,' taunting us to figure out how are you going to solve this big spending crisis."
But Goolsbee believes the back and forth is dangerous. "This is not a game," he said. "I don't see why anybody's talking about playing chicken with the debt ceiling."
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