How much goverment can we fund without raising the debt ceiling?

One fantasy taking hold in the Republican Party is that there’s a way to both not raise the debt ceiling and not cause a market freakout or a government shutdown. “This is what will happen,” promises Michele Bachmann. “Revenue will continue to come into the United States Treasury and we will first pay off our debts, our obligations, and interest on the debt. That’s the first thing we’ll do so we don’t violate our credit rating. After that, we prioritize our spending because we don’t have enough money for everything we want.”

Doug Holtz-Eakin, formerly John McCain’s economic adviser and currently president of the right-wing American Action Forum, is having none of it. In this YouTube video, he gets specific about what that would mean for the federal government. And as he shows, it’d be a complete disaster — and that’s before you factor in the inevitable market freakout as the American political system jumps into an abyss it’s never entered before.

“You couldn’t pay all the mandatory spending, which comes to about $2.1 trillion. So not all the Medicaid, not all the Medicare, not all the Social Security, not all the farm programs. Those kinds of things. And annual discretionary spending? Zero. That means no money for the troops, no money for procurement or transportation of materials, no education, no highways, no infrastructure, no basic research. And even more striking, the decision of what gets money and what doesn’t gets made by the executive branch, no input from Congress. That’s unlikely to happen. We’re going to raise the debt ceiling.”