President Barack Obama told the Wall Street Journal‘s CEO Council meeting on Tuesday that the U.S. should scrap the debt ceiling, which he described as a “loaded gun” creating perpetual crisis in American politics.  “We’re probably better off with a system in which that threat is not there on a perpetual basis,” he said. The president did not address the problem of federal spending except to claim that he has cut deficits.

Obama’s argument that he has cut deficits rests on the assumption that he is not responsible for the massive expansion of the 2009 fiscal year–even though he voted for the unusually high spending of that year while still a U.S. Senator, and added the massive stimulus as president. Obama also claims credit for a sequester cuts that, while originally proposed by the White House, he has spent more than a year trying to undo.

Leaving aside the merits (or lack thereof) of Obama’s fiscal hawk pretensions, the argument he made for removing the debt ceiling agreed with an Organization for Economic Cooperation and Development (OECD) report issued on Tuesday, which advised the U.S. to “abolish” the debt ceiling entirely because repeated political battles over raising it were causing instability to the fragile global economic recovery.


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