The light in the cupola of the Capitol Dome is illuminated, indicating that work continues in Congress, in Washington, Wednesday, Oct. 6, 2021. Credit: J. Scott Applewhite / AP

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You want to borrow some money. The bank will make the loan, because you have an excellent credit history and valuable property to back up your ability to repay.

Later, you tell the bank you won’t be making any more loan payments. The bank says that your credit is so good, you can even borrow some more. But you decide you have too much debt and prefer to stop paying on your existing loans.

The bank is dumbfounded. It warns that you would destroy your top-flight credit rating and won’t be trusted the next time you seek a loan. Even if the bank lends you money in the future, it will charge a much higher interest rate, maybe even placing a lien on your property.  

You are torn between ending debt payments until you can slash your personal spending or avoiding destroying, possibly forever, the good credit rating you have built over the years.

Now substitute the U.S. for yourself in this story and you have the great debt ceiling crisis of 2021.

Congress and the president enact spending bills that commit the U.S. to pay for government programs. The Treasury pays the cost using tax money and, if necessary, it borrows the rest.  The repayment of the amounts borrowed plus interest become part of the federal budget.

When passing spending laws, if Congress does not either cut some other spending or raise taxes, it inevitably requires more borrowing. It may unrealistically assume that the growing economy will send Washington more tax revenues, but it accepts the likelihood of more debt to pay the bill.

Congress also adopts a   debt ceiling, meant to impose a limit on total borrowing. When the amount of outstanding debt bumps up against the ceiling, it is increased. The debt ceiling serves as an easily ignored notice that Congress may be spending too much without necessary taxes.

Congressional Republicans want the Democrats to take the responsibility for the national debt having climbed, though it has built up over decades. They want to block President Joe Biden’s economic plans, though he says it would   depend less on debt than on tax increases on the wealthiest people. So the GOP has blocked an increase in the debt ceiling, except for a short-term extension approved by the Senate on Thursday.

The debt ceiling is pure politics.

The Republicans controlled the federal government when Donald Trump was president. In those years, Democrats joined the GOP in raising the debt limit. The bills had to be paid.

The debt ceiling war is dangerous. If the ceiling is taken seriously and not increased, two major options loom. The government would shut down spending on its normal operations, and use tax revenues to make debt payments. Or it could stop making debt payments and default on its debt.

The shutdown would lead to a blame game. That could hurt either party or both. But default is worse.

The U.S. dollar is the world currency. Some currencies are not backed and their value can tumble, but not the dollar. It is   used in most international transactions. Countries believe that the U.S. will back the value of the dollar and that its powerful national economy will always protect it. Some countries even   use the U.S. dollar as their national currency.

The role of the U.S. as the dominant world power probably results less from its military might than from the dollar, accepted even by America’s adversaries. The world has opted to depend on the American economy and the certainty that the U.S. will back the dollar by paying its debts.

If the U.S. defaults on its debt, it also defaults on its role as the world’s leading power. That’s a lot to risk in playing partisan politics in Congress. GOP Senate leader Mitch McConnell has too narrow of view of the game he is playing. Even his current debt ceiling threats undercut American power.

The  14th Amendment to the Constitution says: “The validity of the public debt of the United States, authorized by law, …shall not be questioned.” President Biden could ignore the debt ceiling and make debt payments as “authorized by law.” Ultimately, the Supreme Court could either uphold the Constitution or keep out of this obviously political game.

In the future, each spending bill should include the sentence: “The debt ceiling is hereby adjusted to the extent required by this appropriation of funds.” That would end the dangerous political games.

In the end of this year’s war, the dollar, now damaged, is likely to survive as the standard, at least for a while longer.


Gordon L. Weil formerly wrote for the Washington Post and other newspapers, served on the U.S. Senate and EU staffs, headed Maine state agencies and was a Harpswell selectman.