Obama's Debt, War and Spending?

Hope and Change? I can't say that is exactly what we have seen since the Obama Administration came into power, well at least not the hope and change many Americans expected. However, I can say that I've gotten absolutely fed up with the bombardment of Obama with claims that he is the reason the economy is doing poorly, or that we have a massive deficit or that we are still at war. The fact of the matter is that Obama has had a little more than two years to clean up an eight year mess left by his predecessor.

At the end of the Bush Administration's ransacking of the country and the economy, Obama stepped in and made very important decisions to which people seemingly withhold their praise. In order to not sound bias, I want to assure everyone that I am not under the impression that everything he has implemented or not implemented be perfect, but he has made some very positive decisions. Healthcare, Financial reform, foreign relations, reduction of military presence in Iraq. So, with all due respect to all those people who just completely hate Barack Obama, he's done a fairly decent job. Most of the problems are Bush's fault, but I guess blame doesn't get put on him. After all, it was Clinton's fault the housing market collapsed and it is Obama's fault that we hold 14.29 trillion dollars in debt.

Raise The Roof or We'll Suffer A Concussion!

It's official, the United States has reached it's debt ceiling. So, then why hasn't the economy started spiraling out of control, unemployment run rampant, or people start looting in the streets? Well, that is easily answered by the fact that the U.S. Secretary of Treasury decided to move some money around so that we could cover our bills for a little while, buying us some time to legally raise the debt ceiling. However, time is once again running out and since June has started, that leaves a little over two months for the US to reach the August 2nd deadline.

Now, as a caveat, I want to assure everyone that a US default on our loans would cause seriously devastating damage to our economy. This issue seems to evade the comprehensive abilities of some people and I find that it is much easier explained with a simple, micro-example. Take into consideration a regular person with credit cards all at the given credit limits, but all their money is tied up and they can't bring themselves to borrow money from a friend or family member because they are either too prideful or think they owe too much already. So, that person decides to just default on their debt obligations. Now what happens?

1. They break their credit limits causing an over limit charge to be assessed by the creditor.
2. They fail to pay on the agreed upon date causing a late charge to be assessed by the creditor.
3. The creditor can renegotiate their repayment terms if default persists.
4. The creditor can require full payment if default persists.

Of course there are many more scenarios that can play out in the case of a default, but generally the outcome would cause negative effects on the defaulting individual. While this is a fairly simple example, the general ideas remain the same in the case of the United States' debt obligations, if the credit limit isn't increased and we cease to service our obligations then it isn't good for anyone.