The Debt-Ceiling Debate Is a Farce, But Fiscal Policy Is a Fiasco

The debt-ceiling law that is once again threatening a US government default is both totally absurd and utterly typical. Washington’s budget process, unfortunately, aligns brilliantly with the country’s broken politics: Combined, they assure institutionalized dishonesty and fiscal recklessness, plus the occasional thrill of possible economic collapse.

Designing a stupider system would be quite a challenge. But critics who confine their complaints to debt-ceiling brinkmanship are missing an important point. American fiscal policy is seriously off-track, and the costs of putting it right are getting bigger all the time. A system that does what the debt limit purports to do — force a review of budget imbalances and measures to correct the problem — is indeed necessary, even if it’s counterproductive to wire such a mechanism to an economic doomsday machine.