Fox Still Doesn't Understand The Debt And Debt Ceiling

Blog ››› ››› CRAIG HARRINGTON

Fox News erroneously characterized President Obama's comment that raising the debt ceiling would not add to the national debt as false. However, raising the debt ceiling only pertains to obligations already made, and does not authorize new spending that would increase the debt. 

On September 18, President Obama spoke at the Washington, D.C. headquarters of the Business Roundtable. During his speech, which ranged from the five-year anniversary of the Lehman Brother's bankruptcy to current policy debates in Congress, Obama warned against mischaracterizations of the debt ceiling, stating, "raising the debt ceiling, which has been done over a hundred times, does not increase our debt."

On the September 20 edition of Fox News' Fox & Friends, co-hosts Brian Kilmeade, Elizabeth Hasselbeck, and Steve Doocy discussed President Obama's call to allow for a smooth increase of the federal debt limit to avoid an unprecedented government default. During the segment, Doocy parroted the myth that increasing the debt limit somehow equates with increasing the national debt.

DOOCY: So the first sound bite was from the president a couple of days ago at the Business Roundtable where he really got people thinking, "Did he just misspeak?" because he said essentially that raising the debt ceiling does not increase our debt. I know he studied law, and not economics, but increasing the debt ceiling indeed raises the debt. [emphasis added]

Raising the debt ceiling, however, does not raise the debt.

In May 2011, when Republicans in Congress first flirted with forcing the government to default on its debt obligations for the first time in American history, the United States Department of the Treasury drafted and circulated a factsheet explaining the debt ceiling. In addition to addressing the potentially catastrophic financial and economic consequences of a debt default, the Treasury expressly debunked right-wing claims conflating the national debt and the federal debt limit. From the document:

The debt limit is the total amount of money that the United States government is authorized to borrow to meet its existing legal obligations, including Social Security and Medicare benefits, military salaries, interest on the national debt, tax refunds, and other payments. The debt limit does not authorize new spending commitments. It simply allows the government to finance existing legal obligations that Congresses and presidents of both parties have made in the past.

The same Treasury Department document noted that raising the debt ceiling does not increase the federal government's obligations, but rather allows the government to meet existing obligations.

Increasing the debt ceiling simply authorizes presidential authority to borrow money, through the Treasury Department, to cover pre-existing expenses and obligations. Furthermore, according to Article I Section 8 of the United States Constitution, only Congress has the power to authorize spending. Raising the debt limit would simply provide President Obama a means to pay for projects already authorized and appropriated by members of Congress

Fox's continued misrepresentation of the federal debt ceiling is in line with other right-wing narratives depicting debt limit increases as fiscal malfeasance on the part of President Obama and congressional Democrats. The network's fundamental misunderstanding of how the debt and debt ceiling function is pervasive -- from falsely analogizing the federal budget with a household budget to downplaying the catastrophic consequences of a debt default, Fox consistently refuses to hear an honest conversation on the functions of government.

Posted In
Economy, Jobs, Wages, & Unemployment
Network/Outlet
Fox News Channel
Show/Publication
FOX & Friends
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