Right now there is a conflict on the debt ceiling. Obama wants Congress to increase the debt ceiling, so that he can exercise his budget, and increase the debt, which is about $17 trillion now. If the ceiling is not increased, then his administration will only be able to spend a little over $2 trillion, not his usual $3.6 trillion this year. The media has pounced on the Tea Party, blaming everything on them.
President Obama has had budgetary debts of $1 trillion to $1.6 trillion every year of his administration. He has driven the total debt from $9.5 trillion to nearly $17 trillion during his tenure as President.
There is a disagreement of economic policy between the Tea Party and the administration. Obama, in consort with the Federal Reserve have a semi-Keynesian economic policy, consisting of Interventionism and explosive spending. The Tea Party doesn’t agree with this economic approach. The administration believes that spending a lot of money will cause high growth, thus increasing employment. The only problem is that it hasn’t worked. The Tea Party follows the Austrian School economics. One of their champions is Ludwig von Mises. One of his books, “Economic Freedom and Interventionism,” explains what happens when Keynesian economics is used. He claims that you can’t have stimulus packages, when funded by debt (which is what America is doing). Also, stimulus packages are not growth, so no long-term growth can happen (meaning that no long-term employment can happen).
This clash between the Tea Party and the administration is going to last for a long while, because finding a cure for anemic job growth is the key to America surviving.