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“Dangerous Precedent” Being Set in Debt Ceiling Debate, Galbraith Says

After five meetings with President Barack Obama in five days, Congressional leaders have yet to hash out a debt ceiling deal that can garner enough Republican and Democrat support to pass a vote.

Time is running out fast. If no deal is reached by next Friday, July 22, there may not be enough time to write up any legislation and move it fast enough through the entire legislative process by August 2 -- the day the United States would breach its $14.3 trillion credit limit.

President Obama is set to address the nation again today at 11 a.m. to emphasize the urgency of the matter.

Treasury Secretary Timothy Geithner did just that yesterday after a meeting with Senate Democrats where he warned about the implications a worst-case scenario could have on the country.

The nation's credit rating would be downgraded within days, the government would be restricted from borrowing money, and the Treasury would not be able to meet its financial obligations at the end of the month, causing some agencies and programs to lose funding, reports Politico.

Professor James Galbraith of The University of Texas, says we've entered "a tragic moment" in history where our elected officials are more apt to put ideology before the good of the entire country. (See: "A Tragic Moment": D.C. Politicians "Totally Wrong" About Spending, Galbraith Says)

"This is not the way we should be perusing these issues," he tells Aaron in the accompanying interview. "We run the risk, first of all, of turning our government into a series of blackmail negotiations, where the full faith in credit of the United States government … becomes a kind of football for the various political agendas: the Republican agenda but also the President's agenda on a long term deficit deal."

Because these negotiations risk setting a "dangerous precedent", it is his view that there is only one way forward from here and it is not one of the two main plans already on the table.

"The debt ceiling needs to be taken off the table. It needs to be recognized that this is not something you tinker with [and] that it is inappropriate to call into question the obligations of the United States government," he says. "We need a clean and substantial increase in the debt ceiling" with no strings attached.

Watch the interview to see why Professor Galbraith is "not in a state of deep alarm about the fate of the Treasury bond market."

For more Daily Ticker coverage of the debt ceiling debate see:

U.S. Hits the Debt Ceiling: What Does It All Mean?

Debt Ceiling Deadline Pushed Back: Will the GOP Budge?

Rep. Levin: GOP "Playing With Fire" On Debt Ceiling Vote

Debt Ceiling Vote a "Political Sideshow", Mish Says: Real Issue Is "Govt. Spending Run Amok"

"No Downside" to Not Raising the Debt Ceiling, Says Chris Whalen

Debt Ceiling Debate: The GOP Is "Blackmailing the American People," Sen. Bernie Sanders Says

Debt Ceiling Uncertainty: Big Banks Take Evasive Action, The FT Says

Deep Recession & Financial Chaos: "Very Dark Scenario" If Debt Ceiling Isn't Raised, Zandi Says

Finally, Someone Is Talking Sense On Our Huge Debt And Deficit Problem — President Obama

What If? "Huge Interest Rate Risk" If No Deal on Debt Ceiling, David Walker Says