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Luke_A_Somers comments on US default as a risk to mitigate - Less Wrong Discussion

2 Post author: bokov 15 October 2013 04:41PM

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Tags: instrumental-rationality risks economics

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Comment author: Luke_A_Somers 17 October 2013 06:46:18PM 0 points [-]

If you think that the debt limit is an important concept for limiting deficit spending, why do you think that it should always be increased?

Because it's a redundant constraint. The budget already limits the debt, and that is the best mechanism for limiting it - it can actually take effect safely. The debt limit is a guillotine. If it ever does anything directly, we are screwed.

Comment author: Lumifer 17 October 2013 06:54:44PM 3 points [-]

Because it's a redundant constraint.

It's not a constraint -- it's a precommitment / beeminder-like device. It's purpose (at least nowadays) is to make borrowing more politically painful.

Comment author: ChristianKl 17 October 2013 07:00:18PM 0 points [-]

Because it's a redundant constraint. The budget already limits the debt, and that is the best mechanism for limiting it - it can actually take effect safely. The debt limit is a guillotine. If it ever does anything directly, we are screwed.

Then why shouldn't we get rid of the guillotine?

Comment author: Luke_A_Somers 18 October 2013 04:34:03PM 0 points [-]

A few posts up:

I wonder, next time control of the House changes, maybe they will try to do away with the debt ceiling.

As far as I can tell, no reason at all.

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