Can U.S. debt be handled like a household budget? - WAFF-TV: News, Weather and Sports for Huntsville, AL

Can U.S. debt be handled like a household budget?

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Source: MGN Online Source: MGN Online

Even if congress and the president can agree on a spending plan, there will still be the question of what to do about authorizing the government to borrow more money.

The debt ceiling debate still confuses a lot of us.

A vote for raising the debt ceiling is always so contentious between lawmakers but this is something the government has done roughly 100 times in past history.

Raising the debt limit comes down to the total amount of money the United States is allowed to burrow to pay off debt that already exists like paying out social security, medicare benefits, military wages, and tax refunds.

Where things get treacherous is when lawmakers attach specific budget cuts to the vote.

Many argue, politicians need to treat the country's debt just like balancing a household budget but Jonathan Hornsby with First Financial Group says there's no way you can compare the two.

"No household has the ability to carry debt over and then print additional money to service that debt. Even if you were in the top 1% of America, you still can't relate to a trillion dollars," added Hornsby.

If congress can't come to a comprise on the debt ceiling, it puts the U.S credit rating at risk for another downgrade and could plunge the economy back into another recession.

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