Debt Ceiling Stalemate

Published: Jan. 20, 2023 at 5:12 PM CST|Updated: Jan. 20, 2023 at 9:47 PM CST
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BISMARCK, N.D. (KFYR) - The federal government is all out of money. Reaching the debt ceiling yesterday sparked debates between Republicans and Democrats on capitol hill about how to handle spending.

The federal government has found themselves between a rock and a hard place. They have reached the debt ceiling and only have until June to either negotiate to increase the debt ceiling or let the county default on loans, which has never happened. Representative Kelly Armstrong says, there will need to be give and take to reach a deal.

“Everybody needs to recognize that the Democrats don’t control all three branches of government anymore, and they’re going to have to negotiate with Republicans,” said Rep. Kelly Armstrong.

Financial Advisor David Wald says allowing the country to default on loans would have catastrophic results, but the past may hold some comfort to consumers.

“While this becomes a political hot potato, we’ve been in this position before and raised the debt ceiling every time. It may come with some political posturing but ultimately, we always have,” said Wald.

America is currently more than 31 trillion dollars in debt, a number Armstrong says is too big to really comprehend, but he said there’s no time like the present to address it.

“If we can’t have a conversation about curving spending in exchange for raising the debt ceiling, I don’t know - If we can’t have it now, I don’t know when we would have it,” said Rep. Armstrong.

Wald says the nation simply cannot afford to default on its debt, not only because of the impact that would have on the U.S. but on a global scale as well.

“If the U.S. defaults on their debt, which is kind of the gold standard in the world, what happens and what’s the domino effect to all these other countries? Also, does that open the door for other countries to come in to be the gold economic standard,” said Wald.

The White House has said they are not willing to negotiate on raising the debt ceiling, while Republicans see this as an opportunity to use the potential default to force the government to cut back on spending. According to CNN, House Republicans are constructing a backup plan to instruct the Treasury Department on which payments to make if legislators can’t agree to a solution.