Federal Government Could Learn A Lot from Dave Ramsey

Hundreds of thousands of Americans have left their debt filled life through the wisdom of Dave Ramsey. I bring this up because the federal government could learn a lot from Dave Ramsey as they prepare to raise the debt ceiling. Let's look at this in layman's terms.

Reaching the debt ceiling is a lot like reaching the credit limits on your credit cards and not having enough money to make payments on the debt. Americans have gotten into this bad habit of applying for more credit cards and paying off the old cards with the new cards, which becomes an endless cycle that traps Americans. In the simplest of terms, this is what the federal government is doing. Of course we left out that when you get your new credit card, it has a higher limit than the previous credit cards, which allows you to continue to spend.

Now we are being told nearly every day by Timothy Geithner that we must raise the debt ceiling in order to keep from going in default. Default happens when America can't make payments on the debt, and in order to make these payments, they have to borrow money.

Now this is where Dave Ramsey comes in. Ramsey would say this is financial suicide. He would scold anyone for living life this way, but yet this is how things work in Washington. Ramsey says for people to get out of debt they must start making sacrifices. He often recommends parting with luxuries that you don't need to live life. Throw a garage sale, put stuff on E-bay, or get a for sale sign. Now I know what you are thinking, how is the Federal Government going to E-bay stuff to reverse the debt. You can't exactly put an M-1 Abrams tank on E-bay. True, but the federal government has lots of assets that can be liquidated to avoid pushing up the debt any further. Veronique de Rugy and Jason Fichtner identified assets the federal government could liquidate to avoid default and increasing the debt ceiling.

So why isn't the United States federal government liquidating assets? Or better yet, why isn't Giethner presenting this other option rather than paint a doom and gloom picture of what would happen if the debt ceiling wasn't raised.

Ramsey's way works. It would be a great start for the United States government to start reversing this debt. Until Americans start demanding the government to liquefy assets, we are going to continue down this wrong path.