See Nov. 4 posts for more on this mess.
From the WaPo Nov. 19:
Last night, with the federal government warning that it was on the verge of defaulting on its debts, the House rejected efforts to reimpose restrictions on tax cuts and spending, then joined the Senate to raise the federal debt limit by $800 billion, to $8.18 trillion.
With last night's passage of the debt ceiling increase, the government's borrowing limit has climbed by $2.23 trillion since President Bush took office: by $450 billion in 2002, by a record $984 billion in 2003 and by $800 billion this year.
Just the increase in the debt ceiling over the past three years is nearly 2 1/2 times the entire federal debt accumulated between 1776 and 1980.
Economists and budget hawks fear that rising deficits are contributing to the steadily declining value of the dollar, which will increase consumer costs, and that those deficits eventually will drive up interest rates and slow the economy.
Last month, the government crashed into the debt ceiling, and the Treasury began borrowing from a civil service retirement fund. On Monday, the Treasury announced it had postponed an auction of short-term Treasury bonds because it was prohibited from borrowing the money.
Yesterday, amid continuing uncertainty about Congress's intentions, the agency delayed revealing how many government securities it plans to sell next week.
Treasury again warned that the government could default on its debt as soon as today if Congress did not act
By passing such a huge increase in the debt limit, with no strings attached, Congress has effectively given the Bush administration a blank check to continue running large deficits, said Stephen S. Roach, chief economist at Morgan Stanley.
"An open-ended license for this kind of fiscal irresponsibility is a recipe for disaster," he said.
[Note: the crashing value of the dollar makes paying our debt easier because it isn't worth as much. Of course, our lenders probably have some inkling of this and will ask for sky high interest rates to make their loans profitable.. Better refinance whatever you owe money on before that happens!]