Both parties in Congress and the administration in Washington are playing a very high stakes poker game with the debt ceiling. They are playing chicken to see who blinks first.

However that tussle ends, I propose today, before hitting the limit, that Congress pass the following law.

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WHEREAS the 14^th amendment, section 4 states “The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned,

WHEREAS Congress has established laws setting a debt ceiling,

WHEREAS Congress has passed various budgets authorizing spending on various programs,

WHEREAS Congress has the authority under Section 5 of the 14^th amendment to enforce payment of public debt,

RESOLVED

Should the various budgets cause the debt to exceed the debt ceiling, that the President would direct federal obligations in order of these priorities:

· Pay the public debt fully and completely in accordance with the 14^th amendment

· Pay essential Military and Law Enforcement activities

· Pay 75% of Social Security payments

· Pay other essential obligations

· All other obligations

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The law should further define nonessential obligations, such as the department of education, department of agriculture, ethanol subsidies, world bank, IMF funding, and UN funding.

This law would make it clear that the “default” option off the table and instead should we hit the debt ceiling would cause angry senior citizens to surround whoever’s most to blame for not being responsible. Anyone remember Dan Rostenkowski being surrounded and how quickly that problem was resolved?

Every year, the government collects about 650 Billion dollars through social security taxes.  Let’s stimulate the economy in 2009 by not collecting that 650 Billion dollars.  Neither employee or employer should pay in 2009.  In return, the retirement age permanently goes up by one year. 

Of course, the government has to borrow the 650 Billion, but the proposed stimulus package contains plans to borrow more than that.

I recognize that the one year delay in retirement needs to be graduated in some fashion, so that people close to retirement age are less effected.  Let the wise men and women in Washington work out one of those compromises that if you’re born before 1950, it’s a 1 month delay, and so on and so on.

The social security tax is highly regressive, so this plan will help those that need help the most.  Rich people will probably complain this plan doesn’t help them.  Awww, everyone has to sacrifice somewhere.  Someone just pointed out, social security is not a tax, it’s a contribution.  Point noted, but not accepted.

It’s been argued that tax cuts don’t stimulate the economy.  That people make the mistake of saving the cut or they foolishly pay down debt.  That might be true in some Keynesian theoretical model, but for me, if we collectively agree to this proposal, then I promise to spend every dime of this temporary tax cut.

Unlike the proposed stimulus plan being kicked around in Washington, this plan immediately kicks in right now.  No waiting years for plans to be drawn up and shovel ready contracts to be bid out.