Earlier today, Republicans joined Democrats in the U.S. Senate voting to increase the debt ceiling to a record debt level of $17.2 trillion and sent the legislation to President Obama for his signature. This action allows the U.S. Treasury to continue borrowing to meet the federal governments obligations and there is little talk in D.C. about reducing spending on the federal level so another authorization will likely be needed in February or March of 2015, as the federal government continues spending beyond its means.
The U.S. House and the U.S. Senate reversed their December, 2013 decision to cut the pension of some veterans and they will not be affected. The stock market did not react to vote ending the day nearly flat with the DOW down just 30 points, the S&P down 0.49% and the NASDAQ up slightly adding 0.24%
The Libertarian Party (LP) has been consistent in their message that Washington needs to dramatically reduce its spending and thereby there would be no need for debt ceiling increases. LP Political Director, Carla Howell, stated as part of the LP response to President Obama's State of the Union speech late last month, "How high does government spending and debt have to be before Democratic and Republican politicians say it’s too much? Will they spend until the economy literally collapses — while workers struggle year after year to find decent jobs? While retirees are trapped in poverty? And the middle class disappears? When politicians talk about “limited government,” it’s their way of covering up the fact that they refuse to cut government spending — and that they continually raise spending. The Libertarian Party says: Stop over-spending. Stop borrowing. NEVER raise the debt ceiling. Balance the budget — not in 10 years. NOW. Just like families and businesses must do every day."
Spending reform has been tabled and it is unclear when or if House Reps or Senators will have the courage to bring them up - especially this being an election year. Texas Republican Senator Ted Cruz said this afternoon, "The next step would have been, I believe, that we would have come together to work on meaningful structural reforms to address the out-of-control spending." Senate Majority Whip Dick Durbin said, “Sen. Cruz has some thoughts he has to share with us. And often times, it takes a little while to express them. … He wants to speak.”
During his response to President Obama State of the Union Address, Kentucky Republican Senator Rand Paul weighed in on spending saying, "Government spending doesn't work. It doesn't create jobs. Only the democracy of the marketplace can find those capable of creating jobs."