Tick, tick. August 2nd is the Debt Limit Armageddon. Or Not.

Debt Ceiling Uncertainty Puts States at Risk
By MICHAEL COOPER
Published: July 21, 2011

The federal debt ceiling debate is already complicating life for state and local governments.

Gov. Bob McDonnell of Virginia wrote to President Obama and members of Congress urging them to raise the debt limit.

Maryland is postponing a bond sale that had been scheduled for Friday, after the state was warned that its credit rating would probably be lowered in the event of a federal downgrade. California, which typically issues short-term bonds at this time of year, is working to arrange bank loans instead, citing the market uncertainty. And state officials across the nation are trying to figure out what will happen to the federal payments they rely on for everything from Medicaid to unemployment to highway construction if a deal is not reached to raise the debt ceiling by the Aug. 2 deadline.

States whose economies rely on the federal government — including Maryland and Virginia, home to many federal employees and contractors — are at the greatest risk if there is no agreement and Washington has to decide which payments to make and which to skip. They were among the states warned by Moody’s Investors Service this week that their credit ratings were being jeopardized by Washington — which would make it more expensive for them to borrow for costs like construction, through no fault of their own.

“For nearly 75 years we have worked hard to earn the highest credit ratings from all three rating agencies,” Gov. Bob McDonnell of Virginia, a Republican, wrote this week to President Obama and members of Congress, urging them to raise the debt limit. “Now your failure to get the job done is hurting the businesses and citizens of our commonwealth.”

Boehner insisted to his GOP colleagues Friday morning that discretionary spending totals for the government get locked into place - Republicans want them capped - so Appropriations Chairman Hal Rogers (R-Ky.) can work to fund the government for fiscal 2012, which begins Oct. 1.

But just two days after the House passed the sweeping “Cut, Cap and Balance” deficit plan, Boehner seems to be lowering expectations. Boehner said that if they took “a big step in the right direction,” they’ll still be “here in 2013” a sign that Republicans are confident they’ll keep the House in next year’s elections.

Taxes, of course, remain a sticking point, and many rank and file Republicans are nervous about the prospects of any new tax revenues being part of a deal. Rep. Patrick McHenry (R-N.C.), in the Friday meeting asked Boehner if new tax revenue is off the table.

Boehner said “it depends how you look at it,” adding tax reform is crucial.

Read more: http://www.politico.com/news/stories/0711/59653.html#ixzz1SrnB3ZBa

Take your analysis to the next steps, and tell us what you "see?" Especially on gold prices - and everything else.

Soz is no more off topic than you and Hawk, with your discussions of gold prices

roger, The price of gold has many things to do with our economy, because it's about inflation and the impact of prices based on this topic; debt limit.

You two can't even do a plausible rationalization, and neither of you is going to limit someone else's posts.

BTW, roger, nobody said anything the freedom to post on a2k. Nobody restricts what people want to post unless it's against the bylaws of the site.

I agree or disagree with what you post depending on its own merits, and I usually spell out why.

soz, This topic is about the debt ceiling. If you wish to talk about another issue, start a new thread.