What happens when the government runs out of money? This is a question that many have pondered as the aforementioned event hit the headlines. Luckily, this question doesn’t have to be answered immediately, as Congress was able to come to a bipartisan agreement to raise the debt ceiling until December.
The “debt ceiling” refers to the limit on the amount of money that the government can borrow in the form of treasury bills and bonds. The government in turn uses this borrowed money to pay off its financial obligations. This limit was expected to be reached on Oct. 7, but fortunately, Congress was able to reach a consensus to raise the number to $480 billion, a number that should keep the government afloat until Dec. 3.
Defaulting on the debt means that Congress would not be authorized to borrow any more money.
Because the government would not be allowed to borrow any more money, it would not have the financial resources to carry out its essential obligations necessary for running a country. If the US defaulted on its debt, the US Treasury would need to halt more than 40% of its payments. This means that many people expecting a check from the government, such as social security recipients or those expecting a child tax credit, would not get what is due to them.
In addition to not being able to provide financial assistance to its citizens, defaulting would mean that “creditworthiness” in the United States would be severely impacted. Interest rates would increase because nobody would want to lend money to the government if they knew that the government did not have enough money to pay them off. This would make the United States an even more expensive place to live.
What sort of agreements can be made to remedy this?
The Democrats are hoping to raise the debt ceiling more permanently in a bi-partisan process, since the debt is so large in part due to tax cuts pushed for by the Republican Party. They may use this opportunity to try and raise taxes.
However, Republicans believe that it is solely up to Democrats to solve this debt crisis because they hold a majority in Congress and control the White House. Republicans want Democrats to raise the debt ceiling more permanently through the reconciliation process. This means that the Democrats would have to go through multiple levels of committee and hearings, and then both chambers would have to vote on an agreement. They believe it is the Democrats‘ responsibility due to the fact that they are pushing a trillion-dollar plan for climate and social programs. Mitch McConnell, Senate Minority Leader, believes that the current crisis is a result of Democratic “mismanagement”. Republicans may use this to try and push their agenda of cutting social programs.
This may lead to a partisan showdown come November. Hopefully, there will be no federal government shutdown.
There are some alternatives to raising the debt ceiling that have been offered. The most popular of these is printing a trillion dollars in coins to help pay off these debts. This suggestion is rather foolish, however, because it would be difficult to distribute these trillion dollars if it was in the form of a coin and it would cause inflation. Inflation harms everyone because it makes the amount of money that people have in their savings and retirement accounts have less value. It also would cause economic instability due to the fact that prices will fluctuate so frequently that people will not know the value of goods anymore.
A more popular suggestion would be to mirror the system that Denmark has by making the ceiling so astronomically high that it would be almost impossible to reach. This would stop the almost routine process of raising the ceiling.
Either way, without a concrete solution proposed by either party, the United States would default on their debts, leading to economic ruin for the citizens and government alike.
In happier news, California is now requiring ethnic studies courses as part of one’s high school graduation requirements.
Assembly Bill 101 requires one semester of ethnic studies courses for all high school students. The curriculum focuses on the experiences and histories of Black, Latino, Asian and Indigenous peoples within the United States. It will also touch on the experiences of Jewish, Armenian and Sikh communities in the U.S.
However, this bill will not be in effect until 2025. Therefore, it will only affect high schoolers who graduate in 2029-2030. These are current fifth and sixth-grade students. Luckily, it will apply to all 1.7 million public high schools in California, including charter schools. A specific curriculum will be determined by each school district or general localities.
Some have proclaimed that this move is too radical, feeling that it would will create a divide. However, there is something to be said about whether this bill goes far enough. It is only one semester as opposed to the two full years of history, mainly white history, also required for graduation. It also does not change the fact that other classes still may be teaching principles that underlie white supremacy and other modes of dominance. For example, science classes may not teach that the largest polluter is the US military. One semester is not enough to undo the colonialism that is embedded within the curriculum.
However, that does not signal despair, as the Colorado State University Department of Liberal Studies claims: “ethnic studies [gives us insight into history] but it also helps us navigate the present by instilling students with a nuanced understanding of the structures that dictate US Society.” Luis Alejo, the author of said legislation, claims that “our students must see themselves reflected in their school, their curriculum and the knowledge they learn.” Hopefully, with this legislation, we will begin to see a more broad and inclusive understanding of history.
The City of Oakland is requiring vaccines for all city employees. All employees must confirm their vaccination status no later than Nov. 15 and must be fully vaccinated by Nov. 29, unless they have applied for an exemption. This policy will apply to all who do work for the city, including volunteers.
City Administrator Ed Reiskin justifies this decision by saying, “Vaccines are safe, effective and essential. They are free and easy to get. I firmly believe that the most responsible action for us to take as an employer, particularly a public employer, is to require our employees to be vaccinated.”
Luckily for city workers, there are now three additional free vaccination clinics at city worksites: Municipal Service Center, Police Administration Building and 250 Frank H Ogawa plaza. Employees can take two paid hours to get each dose of the vaccine.
In addition, from today until Nov. 30, Oakland is expanding its vaccination and testing centers to seven days a week for all residents, news that is pertinent now that booster shots are becoming available and people are looking to get their third dose.
More good news for the residents of Oakland: the city is making efforts to close the digital divide. Oakland is partnering with the Greenline Institute to provide funding for 10 grassroots Oakland–based organizations as part of a program called “The Town Link.” This program is intended to increase digital literacy in communities that have previously lacked stable internet connections. The Greenline Institute found a connection between redlined neighborhoods and those lacking broadband access. Therefore, 10 community–based organizations, including churches and community centers, are receiving $10,000 apiece to provide computers and tablets to those who lack these devices. They also will provide training on how to use their digital devices.