The Debt Ceiling Crisis JUST got Worse | Stimulus Danger.

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first let's talk about this nancy pelosi

delay the debt ceiling what we got to

know about it and expectations going

forward for what's going on with the

crazy world of congress first we got to

talk about the delay

nancy pelosi and house democrats

promised that they would vote have a

vote on the one trillion dollar

infrastructure package that's already

passed by the senate all the house has

to do is rubber stamp it essentially

they promised they would hold a vote

today well no surprise nancy pelosi is

now suggesting instead of passing the

bill today we're just going to begin

debating on the bill today

and then we'll have a vote on the 30th

but she says make no mistake quote let

me just say we're going to pass the bill

this week

well we've heard that before and the

problem is nancy pelosi just doesn't

have enough progressive votes yet in the

house of representatives to actually get

this one trillion dollar package passed

this is the hard infrastructure package

right so we're talking

airports bridges railroads water ports

waterways broadband and so on and so

forth thought she had the votes didn't

have the votes because certain

progressives especially those led by the

house progressives committee say hey you

know what we want to wait until we have

three and a half trillion dollar

infrastructure the social infrastructure

package lined up and ready to go then at

that point we'd be willing to vote on

the one trillion dollar package

so is nancy pelosi actually going to be

able to get us a vote on that one

trillion dollar package this week we'll

see because right now there's a lot of

work to do on that three and a half

trillion dollar package in fact nancy

pelosi responded saying that it is

currently quote self evident that the

three and a half trillion dollar package

might end up shrinking in size to try to

get the votes needed to get both of

these packages done now let's talk about

extending the government's budget and

the debt ceiling so the house passed a

funding bill that would extend the

government's budget from september 30

this year to december 3rd and would

suspend the debt ceiling until december

of 2022

now this bill is well has passed the

house and now is sitting in the senate

the senate is expected to vote on

cloture today cloture requires 60 votes

and it's a fancy way of saying closing

the debate so in my opinion like a

little trick is anytime you hear cloture

it sounds a lot like closure so bringing

debate to closure it's just a quick

little mental trick for that but

basically that would then take 60 votes

and once debate ends then a bill can get

passed with 51 votes problem is

republicans are expected not to support

this bill because republicans do not

want to see the debt ceiling get

extended until december of next year so

the most likely scenario is that this

bill is going to fail and the senate is

essentially going to

amongst leadership verbally counter and

say hey bring us something that only

extends the government's budget so the

government doesn't shut down but we're

going to have to talk about this debt

limit issue more so now what happens if

the government shuts down and what

happens if the debt ceiling isn't raised

who stops getting paid and why do we

even have a debt ceiling and where do we

stand on this debate right now well

before we talk about that i've got to

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happens if the government shuts down

well if the government shuts down you

end up getting a partial furlough of

literally hundreds of thousands of

federal workers you end up getting

museums and parks shutting down you get

about 50 or it might be closer to like

62 percent of employees actually that's

it's 62 percent i had it written down

right here 62

of cdc employees would get furloughed

that's if the government shuts down

which is bad we don't want the

government to have to shut down again

now the worst of these is the debt

ceiling because when the debt ceiling

gets passed which again we already have

but we literally run out of money like

we can't play accounting tricks anymore

we literally run out of money then we

might also miss our payment obligations

on things like treasury bonds which

treasury bonds affect interest rates in

whole lots of markets throughout the

world and you could literally some say

see the spawning of a recession if we

miss our obligations and our payments

because that full faith and credit of

the united states breaks apart that

would be really really bad the debt

ceiling is the cap when the total amount

of money the federal reserve is

authorized to borrow it matters because

we do something known as deficit

spending we spend more money than we

make this is a big financial no-no for

families but okay for governments

because well indirectly they run the

printing press now technically we

already passed our debt ceiling but

janet yellen has been going all

all out on this trying to play counting

tricks and games to make sure we can

have as much cash as possible for as

long as possible this is why we only

have best estimates in terms of when

we're actually going to break that debt

ceiling limit to the point where we

literally run out of cash and

potentially default on bonds default on

social security payments or child tax

care credits

and those the payments associated with

those this is known as the x date

because we're unsure of exactly where it

is but we expect it to be somewhere

between october 15th and november 4th

this is going to create a lot of

uncertainty a lot of this of course also

has to do with the fact that pandemic

relief is still going out to individuals

and waves but this is a mitigating

factor on october 15th a lot of income

taxes get paid for those who were on

extension for their 2020 tax year and

this could end up being a windfall which

would be good and would help kind of

kick the can down the road a little bit

longer on the debt ceiling

right now our national debt sits at

28.43 trillion dollars our borrowing is

capped at 28.4 so already over a little

bit but we're literally just going to

run dry we're not going to have anything

in the chests anymore so to speak in

about two to four weeks

so at this point some have argued let's

just get rid of the debt ceiling let's

borrow as much as we need to but many in

favor of keeping the debt ceiling see it

as a tool for limiting government

spending so really the only other modern

country that does this is denmark but

here in america we keep it because it's

really become a bargaining chip for one

side to argue hey like we can't do that

bill or we can't spend money on that

because then we're going to break the

debt ceiling again so all this has of

course raised the question of why do we

even have a debt ceiling and it's mostly

become a negotiating tool so that one

side can really keep the reins on

another side spending in this case

republicans keeping reins on democrat

spending because it's an actual limit

that if we breach bad things happen and

it's a great tool for trying to limit

spending although most say look if we

all agree to vote on certain bills and

they're going to cost us a certain

amount of money why do we need two

limits like if we're going to pass a

bill let's pass a bill and actually

fully pay for it so this is where you

get arguments around the debt ceiling

from both sides

at the same time we've got pelosi and

chuck schumer racing to come up with a

framework for the three and a half

trillion dollar package and we've got a

lot of drama around this for example

many republicans are now echoing donald

trump's talk about this bill being a

quote fake infrastructure bill composed

of just 11 infrastructure and saying

that it's not real infrastructure now

most don't actually think that he's

talking specifically about the

bipartisan infrastructure package which

is mostly

bridges railroads airports and hard

infrastructure things big ones we expect

that donald trump is talking about the

social infrastructure package now

mccarthy tries to separate this and make

it a little bit more clear and agrees

that the big three and a half trillion

dollar infrastructure plan is just a big

social liberal wish list buddy carter a

republican representative didn't have

anything good to say about this in fact

he said quote we have a spending problem

we need to cut up the credit card and

avoid this cradle-to-grave government

dependency that ruins the american dream

it's a socialistic nightmare they're

willing to shut down the government to

be reckless spenders now obviously

democrats argue that we should have

things like universal pre-k

paid leave and the extension of the

child tax credit along with taxing

wealthier individuals more but

republicans make the argument that it is

not the responsibility of government to

raise the credit limit to continue to

pay for socialistic spending he goes on

to say democrats want to raise the debt

ceiling to get through their three and a

half trillion dollar socialism wish list

we call this the build more inflation

act that's obviously a play on the fact

that joe biden's plan is called the bill

back better plan build back better and

so a republicans counter no it's build

more inflation

anyway now it's worth noting that

democrats have also expressed concerns

right now and that's because a lot of

democrats say they're just not going to

support the 1 trillion bill which nancy

pelosi says she'll have a vote on the

30th until the 3.5 trillion dollar bill

is done and ready to sign but that's a

problem because the 30th is in three

days and the three and a half trillion

dollar bill doesn't even have a solid

agreed upon framework yet amongst

democrats now let's talk about

expectations and try to tie this all

together so here are my thoughts i think

we're probably going to get this one

trillion dollar infrastructure package

done and out of the way i think we'll

get it done around the same time that we

kick the can down the road on funding

the government hopefully to the end of

the year that is my optimistic scenario

that we get that one trillion dollar

package out of the way both sides agree

on that get it out of the way get it

funded get going on it and then

get that budget extended for the

government

then we're gonna have to have to talk

about the debt ceiling i don't think

we're actually going to get the debt

ceiling increased unless that's part of

a broader budget reconciliation package

which could be that three and a half

trillion dollar infrastructure package

but that means congress is going to have

to work day and night to get that three

and a half trillion dollar package done

and signed and raised that debt ceiling

before october 15th it's possible those

could be some pretty tenuous days and we

might end up day by day going okay we've

only got this much money left in the pot

we've got about two days left we got 48

hours left before we miss our

obligations that's gonna motivate

democrats really hard to get that three

and a half trillion dollar package

sealed and and done it's possible that

it might be smaller as nancy pelosi has

already alluded maybe it'll be like 2.9

trillion dollars joe biden doesn't think

so he thinks that 3.5 is already a

compromise and we'll see

but

everything's going to come down to the

wire in the next few weeks here because

we're going to be running out of money

soon so these are my expectations

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