Let me just state a few more basic premises. While a good Treasury Secretary can be very creative in a pinch (think Lincoln's Salmon P. Chase and FDR's Henry Morganthau - assisted by BYU-grad Mariner S. Eccles at the Federal Reserve). It is still the responsibility of the Congress to raise money and authorize the spending and borrowing of such.
Clause 1: The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States;
Clause 2: To borrow Money on the credit of the United States;
U.S. Constitution, Article I, Section. 8.The Debt Limit is an arbitrary law imposed by Congress essentially on itself - about as pointless as all the budget limitations they have attempted on themselves (which doesn't exactly bode well for any balanced budget amendment). They could just as easily have authorized the Treasury to borrow up to the money they have actually appropriated or otherwise obligated but that would probably make too much sense. So, if they are not going to allow borrowing to pay for what they've already obligated then they have to cut what they've already obligated. Hence, the fun going on in DC.
The best part I heard on a NBC news blip was that Cantor was silent at today's meetings. Apparently, Speaker Boehner, actually to his credit, has the guy under his control.
Sure, we have to live within our means, but debt can be, if properly used, a way to generate, stimulate, and grow markets (in fact, there is a debt market itself - hence, Wall Street shudders - not to mention Beijing, Hong Kong, and Shanghai). And even in the not always applicable family-kitchen-table finances, debt is an important and legitimate part of the equation - at least for a modest mortgage, education, etc.
Do I have a vested interest? Of course! If they really get to the point where they can't meet all their payments, whose checks do you think they hold back first? Yep. The federal employees' - everybody's favorite whipping boy. And that's OK because I can always fall back on my retirement savings which is principally invested in safe and secure US Government Bonds. Oh. Wait.
ADDENDUM July 15, 2011 (Day after Bastille Day)
This is a good run down on the basics from CNN: