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Kevin Hassett and Abby McCloskey: Obama Rewrites Debt-Limit History - WSJ.com


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I hadn't known this history of debt limit negotiations.

Here's the key:

While the debt-limit kabuki inevitably roils markets as deadlines approach, the alternative absence of fiscal discipline would make government insolvency more probable in the fullness of time.

So yes, the debt-limit is a political weapon that has been wielded many times.

It is why Republicans were so confident in the deficit spending strategy last decade.

Debt limit chicken is part 2 of the Starve the Beast economic strategy:

http://en.wikipedia.org/wiki/Starve_the_beast

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