Ron Paul: Stop Raising the Debt Ceiling

Date: 05/23/2011

by Ron Paul

The federal government once again has reached the limit of its legal ability to borrow money, meaning it cannot issue new Treasury debt without action by Congress to increase the debt ceiling limit. As of this month, our “official” national debt- which doesn’t include the staggering future payments promised to Social Security and Medicare beneficiaries- stands at $14.2 trillion.

The debt ceiling law, passed in 1917, enables Congress to place a statutory cap on the total amount of government debt rather than having to approve each individual Treasury bond offering. It also, however, forces Congress into an open and presumably somewhat shameful vote to approve more borrowing. If the new Republican majority in the House of Representatives gives in to establishment pressure by voting to increase the debt ceiling once again, you will know that the status quo has prevailed. You will know that the simple notion of balancing the budget, by limiting federal spending to federal revenue, remains a shallow and laughable campaign platitude.

It is predictable that Congress will once again merely delay the inevitable and raise the debt ceiling, after the usual rhetoric about controlling spending, making cuts, and yes, raising taxes. We have heard endless warnings about how irresponsible it would be to “shut down the government.” The implication is that sober, rational, mature pundits and politicians understand reality, while those who oppose raising the debt ceiling limit are reckless ideologues who will harm the economy just to make a point.

But like any debtor that has to reduce its spending, the federal government simply needs to establish priorities and stop spending money on anything other than those priorities. Interest payments on our federal bond debt likely will amount to about $500 billion for fiscal year 2011, an average of $41 billion per month. Federal tax revenues vary by month, but should total around $2 trillion to $2.5 trillion for FY 2011– an average of perhaps $180 billion per month. So clearly the federal government has sufficient tax revenue to make interest payments to our creditors. For now, those interest payments represent about 12% of the total federal budget.

What nobody wants to admit is this: even if the federal government has only $1.5 trillion remaining to spend in 2011 after interest payments, this is PLENTY to fund the constitutional functions of government. After all, the entire federal budget in 1990 was about $1 trillion. Does anyone seriously believe the federal government was too small or too frugal just 20 years ago? Hardly. So why have we allowed the federal budget to quadruple during those 20 years?

The truth is, in spite of how cataclysmic some might say it would be if we did not pass a new debt ceiling, it is hardly the catastrophe that has been advertised. The debt ceiling is a self-imposed limit on borrowing. The signal congress sends to worldwide markets by raising the debt ceiling is simple: business as usual will continue in Washington; no real spending cuts will be made; and fiscal austerity will remain a pipe dream.

When our creditors finally wise up and cut us off, we will be forced to face economic realities whether we want to or not. It would be easier to deal with the tough choices we face now, on our own terms, rather than wait until we are at the mercy of foreign creditors. However, leaders in Washington have no political will to admit that we cannot afford to continue spending without any meaningful limit. They prefer maintaining the illusion and putting off reality for another day.


  • DrRonPaul

    I really can’t believe how gullible and cowardly americans are these days.
    The fed is simply bullying.
    Give us your money…or else!

  • michael

    the American government is like a gambling addict, they can never stop no matter how deep the hole. We all know what happens to gambling addicts, most end up in the gutter. I hope Ron Paul can save your country from the gutter, that is where it is heading. GOOD LUCK MR. PAUL IN 2012

  • Michael

    Please Ron Paul, make it happen for libertarians. Leave politics and let a sane libertarian have a chance. Someone who actually wants to get elected.

  • I love it. They’ll only agree to lower taxes if they raise taxes, spend less only to spend more. Bolshevik double-speak. THROW THEM OUT. RON FOR PRESIDENT! Here’s a good theme song.

  • PeoplePower

    If you were in debt would the fed bail you out ? no then why should you raise the debt ceiling ?

    Go Ron Paul 🙂

  • tj

    I always end my posts w/ Ron Paul 2012…You are either for FREEDOM or you are not…

    Now I know that probably less than 10% of those on here professing support of Ron Paul are truly for FREEDOM…nonetheless, we need all the votes we can get…

    For instance, true libertarians like Ron Aul are opposed to public education…now, I do not have time to argue this issue…however, at the very least, all of us can agree that the Federal government should not interfere in this…it just adds a costly, inefficient, detrimental layer of bureacracy to educating America’s schoolchildren…

    there are other issues that Ron PAul would at the very least get the Federal government out of, of course…and this will certainly make it easier to…
    a)lower government spending
    b) lower government regulations,
    c) lower taxes, and
    d) improve our national security by protecting our borders…so….Ron Paul 2012…you are either for FREEDOM or you are not…but even if you are for “more” freedom, please vote for Ron Paul

  • T

    I love Ron Paul, but lets face it, he has ZERO chance of winning the republican primary. Why you ask?

    A) Because the people voting in the primary are a bunch of fox news watching idiots. Seriously, this is a group of people who think Glen Beck is the most intelligent person of TV.

    B) Sadly without huge corporate donations you cannot possibly raise enough money to convince people to vote for you, and with Dr. Paul that would be the end of the corporate welfare state.

    My advice to him would be run as a democrat, he’s going no where in this modern age Republican party.

  • Marco P

    I’m a great supporter of Ron Paul! He’s the only one who understands the problem of having a federal reserve system.

    About the debt ceiling, I sincerely do not see the issue there. It is just a number on paper. It means printing money rather than solving the problem, but I find immoral
    to tax the people in order to pay the interests (and only the interests) on the federal debt.
    Having the power to print the dollar would also mean having the power to
    issue interest-free bonds. We know that the Fed does not like it but that is certainly possible.

    I wish to remind anyone who speaks of government debt, that private banks also have an enormous amount of debt. The debt with US the people. Every penny in your bank account is NOT stored for you in some place, it is a credit you have with your bank, which is in debt with you.
    All the banks are in debt with the account holders for the total amount of money in their accounts.
    This would be true even if we use gold as a currency.

    Obviously I don’t claim I have a solution, I just wish to remind everyone that is the interests paid that matter, not the debt ceiling.


  • Glen

    Who knew Red Skelton could break it down so wise in words we have recited our entire life.

  • quahogger316

    i was watching my local nbc news the other day, and they posted the republicans running for the 2012 election. the list did not include ron paul. what i want to know is if they purposely left him off the list? you know, these propaganda machines know as news networks now aday, have thier own agenda. i think washington and the ultra rich are afraid of paul running, because he might just shake things up!

  • You go, Mr. Paul! It’s a shell game at best. Here’s your new theme song.

  • jugeteable

    there are so many people against ron paul it makes me sick, michael medved called him a crack pot.

    • tj

      so call Michael Medved and tell him why you think Ron Paul is not a “crackpot”…Edved also called libertarians …”losertarians” a couple of years ago…

      if we want to succeed, we need to stop complaining and do something about it….call…write…shout….disrupt….display your support for Ron Aul and FREEDOM…

      Ron PAul 2012…you are either for FREEDOM or you are not….

  • PeoplePower

    Dear Ron, keep up the good work
    I love it when you wipe the smile off Ben Bernanke’s face.
    Here is my view,
    When someone is in debt they borrow money from their friends to pay it off.
    Now lets suppose your friends are in debt also & can’t lend you money.
    So they themselves borrow money from other people & it goes on forever.
    Basically the country is totally bankrupt with no one to borrow money from
    so there is infinite debt, whatever cuts to jobs or services are made all money saved today is spent tomorrow.

    We need a new financal system that will dispose of this debt infinity loop forever BRICS could be the answer gold backed sound money. Paying with gold from fort knocks is a great idea, untill you find out they are worthless lego bricks,
    God said “let there be light” he never said Ben Bernanke may create money out of thin air. For all those bankers ect who can’t answer the question of what money is
    Definition Of Money: “A failed bad idea”.

    Go Ron Paul 🙂

  • 1dabirdman

    A living breathing “Founding Father!” RON PAUL FOR PRESIDENT! 2012….the revolution has startted,if hes not elected,the revolution will turn from a “diplomatic” revolution, to a “full on” revolution! so say the people! we’re fed up with the “status quo!”

  • flipdabird02

    Raising the debt ceiling will indeed send a STRONG signal to the markets/creditors that the US in not addressing its fundamental debt problems and will make them nervous. HOWEVER, if we do not raise it, markets and creditors will calm down as they see that the US is indeed trying to do something positive about their fiscal health, and prosperity and integrity can be restored in this country eventually

  • MrBotheman

    The people who criticize him for no reason make me laugh. They always have no argument and just say that he’s racist or something stupid like that. Stop spreading misconceptions about him. He has a great record and the policies he stands by are constitutional. None of you have anything on him and you know it! GROW UP……..

  • MrEdwinauer

    Let banks and hedge funds go bancrupt. Only save the little men / public.

  • badaboomrock

    I Have a question why do people keep attack Social Security like it is part of the debt? when I have paid for my share of it out of my pay my whole work life. I know what I pay go’s to the people in front of me and the one that are behind me will pay for me when I get old and can not work any more. I just don’t understand how they can say it is part of the debt when it is paid for allready by our taxes?

    • Lucy76


      At the growing rate of people retiring, SS won’t be there for the people behind you. It was never meant to be a retirement fund and be the only source of income for the elderly. I’m 35 and make no plans to having it when I get old because it’ll be gone, yet I pay into it just like everyone else. It may not be in the red now, but wait until all the baby boomers retire. Rand explains this perfectly

  • Michael

    Good grief! You can’t stop the debt ceiling from being raised after the fact. Ron Paul, you are again sensationalizing to the mentally challenged. And the worst part of it is, you know damn well what you’re doing.

    And for that reason Ron Paul, you will be my president!
    when hell freezes over.

    • Van White

      I wil presme that you are not living on govt “assistance”

      I suppose you are a federal employee. Who, other than those living on govt cheese, would want govt employees to be so overly compensated and want the federal payrolls to be so bloated when most of the “services” are simply counterproductive.?

    • Libertarian777

      instead of just running your mouth off Michael, why don’t you take a position and explain it?

      So we should raise the debt limit ad infinitum? Why don’t we just run the presses 24/7 and give everyone $1m each. Infinite money. Then everyone can pay for all their health care / retirement needs.
      We should debase the US$ through QE-100?

      And all these economic policies have worked wonders since the $2.5 trillion balance sheet of the Fed has decreased unemployment to 5%?

      • tj

        Lol…now that is more like it…the wise posts from LIbertarian777…The best way to show the ignorance of liberal policies is to go beyond their numbers to demonstrate how ridiculous they are…I often joke when liberals bring up minimum wage and suggest raising it….if they think it should be $9/hr, I ask them why not $20…if 9 is good, is not 20 better? Or, when BUsh tried his stupid, ill-fated stimulus, I suggested to a liberal that he should have given everyone a million dollars…

        the point is $1 of deficit spending weakens the dollar as proportionately as $100,000,000,000,000 does in the exact same manner…

        Finally, a comment about social security. In 2011, it will finally take in less than it pays out…and will do so for an extended unlimited future…it is broke and needs to be phased out…the obligations need to be paid from the sale of government assets and, if more is needed, from printing money (as distasteful as that is…) and, the debt that is most often quoted does NOT include SS

        Ron Paul 2012…you are either for FREEDOM or you are not