Gov. Tim Pawlenty has offered an alternative to raising the debt ceiling: instead, pass a law putting creditors first in line for the receipts that flow into the Treasury in April and May.
This suggestion is more a piece of campaign positioning than a serious idea. But let’s take it seriously for a minute. How would it work?
1) Creditors are owed interest. They are paid first.
2) Doctors and hospitals submit invoices for Medicare and Medicaid. The early arrivals are paid, but the later arrivals not?
3) Replacement equipment is needed in Afghanistan. It goes unreplaced?
4) Does the Treasury Secretary get to pick and choose which bills to pay? Or is it first come, first served?
5) The US is running a deficit of $1.3 trillion on spending of $3.8 trillion. In other words, we hit the wall about 8 months into the fiscal year. What happens then?
6) Paul Ryan’s “Roadmap” calls for moving to a no-net-increase-in-debt budget over the course of decades. Tim Pawlenty is calling for it to happen by May. That’s ambitious, in the same sense that trying to knock down a brick wall with your car is ambitious.