Congress narrowly avoided pushing the country off the fiscal
cliff. But it has done nothing to address the next and
potentially bigger risk to the economy: the need to raise the
debt ceiling. To help separate fact from fiction in the battle,
here's what you need to know about the issue. What is the debt
ceiling exactly? It's a cap set by Congress on the amount of
money the federal government may borrow. The limit applies to
debt owed to the public (i.e. anyone who buys U.S. bonds) plus
debt that the Treasury owes to government trust funds such as
those for Social Security and Medicare. Why does it need to be
raised? The debt ceiling needs to be raised periodically because
both parties in Congress have approved tax cuts and spending
increases over the years, knowing full well they will add to
deficits. By doing so, they increase the country's future
borrowing needs. That's why raising the debt ceiling is not a
"license to spend more," as some Republicans assert. It simply
lets the Treasury Department continue