Peter Schiff Says Raising Debt Ceiling Won't Preserve America's Prosperity But This Will

As the government and Republic lawmakers work overtime to settle the debt ceiling issue amicably, noted economist and gold bull Peter Schiff said a resolution alone will not work wonders for the U.S.

What Happened: “According to Democrats and [Joe] Biden, America’s prosperity hinges on the ability of the Federal Govt. to go deeper into debt. In truth, the best chance we have of preserving prosperity is to not raise the debt ceiling, cut government spending, and finally start paying our bills!” Schiff tweeted.

The debt ceiling is not unconstitutional, but the president invoking the 14th Amendment to circumvent it is, Schiff said.

"If Biden wants to pay the debt without raising the ceiling, he must balance the budget," he added.

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Why It's Important: Schiff's views are in line with the Republican philosophy of falling back on spending cuts to balance the budget. GOP lawmakers want spending cuts to be part of the bill to raise the debt ceiling.

On the contrary, the Biden administration is eyeing bringing in additional revenue sources such as through taxing the richest, as a means of bringing fiscal disciple.

Before heading to Japan for the G7 meeting, Biden said he is confident of breaking the debt ceiling impasse, thereby avoiding an unprecedented and potentially catastrophic default.

A select group of negotiators from both sides is set to discuss a speedy resolution to the crisis at hand.

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