U.S. Stands on the Edge of the Sword!
Published in Alarabalyawm
(Lebanon) on 31 July 2011
by Mohammed Kawash (link to original)
(Lebanon) on 31 July 2011
by Mohammed Kawash (link to original)
Translated from
by Mouhsine Abdellaoui.
Edited by Nathan Ladd
.
These are critical hours for the United States, as the dollar sits on a razor’s edge. The country, with its tremendous economy, is at a crossroads because of the debt ceiling issue.
If the U.S. debt ceiling collapses, it will do so on top of every head in America, Europe and the Third World. The upcoming events are great; they resemble a new Tsunami that could strike the U.S. economy and fracture the global financial system.
This risky game being played by Republicans and Democrats in Washington over the presidential elections next year has made the world hold its breath.
Republican leaders in the House delayed voting on the White House draft to address the U.S. debt ceiling by raising the borrowing ceiling, whereas Democrats proposed an alternative plan that allows conditional borrowing for a few months only.
This is the reason why all eyes are now turned towards Washington, which has an August 2 deadline. That is to say, next Tuesday, U.S. official sources expect an economic disaster if no agreement has been reached on the White House’s draft. This means that the U.S. would be reduced to a country unable to pay its bills, many of which are for salaries, aid and military spending. Because their military forces presently occupy Afghanistan and Iraq, such a failure would have a negative impact on their foreign relations.
Some people predict that President Obama, in his confrontation with Republicans, will resort to a constitutional amendment that would be invoked for the fourteenth time in the history of the United States. This would authorize him to make a unilateral decision to raise the debt ceiling. The amendment dates back to the era of the Civil War, which took place in the 1860s, when the United States stood on the brink of bankruptcy. I believe that bonds were then sold to people to spare the State from bankruptcy, and President Abraham Lincoln managed to resolve the military and financial battle and save the United States.
As for the debt ceiling issue, it was approved by the U.S. Congress for the first time in 1917, when the United States participated in the First World War, to give the government the flexibility to cover its expenses, under the condition that the debt did not exceed the legal limit. This decision has encouraged successive governments to borrow in such a way that between 1917 and 2010 the debt ceiling has been raised about 100 times. In that time, the debt rose from one to $14.3 trillion.
Today, the whole world is following the fluctuations of the U.S. economic and financial systems with interest. The aftershocks of the recession affect the global economy, though some people rely too much on the possibility that Republicans and Democrats will reach agreement at the end of a conflict that has rocked President Obama at home and abroad.
If the U.S. debt ceiling collapses, it will do so on top of every head in America, Europe and the Third World. The upcoming events are great; they resemble a new Tsunami that could strike the U.S. economy and fracture the global financial system.
This risky game being played by Republicans and Democrats in Washington over the presidential elections next year has made the world hold its breath.
Republican leaders in the House delayed voting on the White House draft to address the U.S. debt ceiling by raising the borrowing ceiling, whereas Democrats proposed an alternative plan that allows conditional borrowing for a few months only.
This is the reason why all eyes are now turned towards Washington, which has an August 2 deadline. That is to say, next Tuesday, U.S. official sources expect an economic disaster if no agreement has been reached on the White House’s draft. This means that the U.S. would be reduced to a country unable to pay its bills, many of which are for salaries, aid and military spending. Because their military forces presently occupy Afghanistan and Iraq, such a failure would have a negative impact on their foreign relations.
Some people predict that President Obama, in his confrontation with Republicans, will resort to a constitutional amendment that would be invoked for the fourteenth time in the history of the United States. This would authorize him to make a unilateral decision to raise the debt ceiling. The amendment dates back to the era of the Civil War, which took place in the 1860s, when the United States stood on the brink of bankruptcy. I believe that bonds were then sold to people to spare the State from bankruptcy, and President Abraham Lincoln managed to resolve the military and financial battle and save the United States.
As for the debt ceiling issue, it was approved by the U.S. Congress for the first time in 1917, when the United States participated in the First World War, to give the government the flexibility to cover its expenses, under the condition that the debt did not exceed the legal limit. This decision has encouraged successive governments to borrow in such a way that between 1917 and 2010 the debt ceiling has been raised about 100 times. In that time, the debt rose from one to $14.3 trillion.
Today, the whole world is following the fluctuations of the U.S. economic and financial systems with interest. The aftershocks of the recession affect the global economy, though some people rely too much on the possibility that Republicans and Democrats will reach agreement at the end of a conflict that has rocked President Obama at home and abroad.