The GOP now is in the majority in the House of Representatives after mid-term elections last November that many victors and tea-party activists viewed as a mandate for deep spending cuts.
"My members won't vote to increase the debt limit unless we're taking serious steps in the right direction," says House Speaker John Boehner, R-Ohio.
After a White House meeting with Obama on Wednesday to preview the speech, Boehner said, "I think the president heard us loud and clear." He agreed that passing a debt-limit extension is highly important. "Not meeting our debt obligations is a very bad idea," he said. But Boehner also insisted that higher taxes not be part of any debt relief deal.
The national debt is the total accumulated indebtedness of the U.S. government. As of Wednesday, it stood at $14.27 trillion. Of this, $14.21 trillion is subject to the debt limit. For various mostly technical reasons, several small governmental programs are not counted.
The national debt should not be confused with the federal budget deficit, which is only a one-year slice. The deficit is the difference between what the government spends in a given year and what it takes in. In the budget year that ends Sept. 30, the deficit is expected to be a record $1.5 trillion. At that level, for every $1 the government spends, it must borrow about 42 cents.
Only a few times in the nation's history has the government run a budget surplus. The most recent was in the early 2000s, when for several years the government took in more than it paid out. That helped take a nick out of the national debt, then hovering between $5 trillion and $6 trillion. Soon deficits returned and the national debt resumed its relentless climb.
"America's finances were in great shape by the year 2000. We went from deficit to surplus. America was actually on track to becoming completely debt-free, and we were prepared for the retirement of the baby boomers," Obama said. "But after Democrats and Republicans committed to fiscal discipline during the 1990s, we lost our way in the decade that followed."
The national debt began when President George Washington and Congress agreed to take on debts incurred by the states for fighting the Revolutionary War.
It broke through the $1 trillion mark (that's a $1 followed by 12 zeroes) in 1981, the first year of the Reagan's presidency. But despite Reagan's vow to balance the budget, the debt tripled during his two terms, to just over $3 trillion under the weight of a recession, large tax cuts and increased spending.
When his successor, President George H.W. Bush, left office in early 1993, the debt was over $4 trillion. Clinton's eight years in office took it to nearly $6 trillion, despite those fleeting budget surpluses. When George W. Bush finished his two terms the debt had pushed through the $10 trillion mark.
A celebrated national debt "clock" near Times Square had to be rebuilt to allow for the extra digit.
In just 2½ years under Obama, the debt has grown to where it stands today.
Of the $14.27 trillion national debt, some $4.62 trillion is money the government owes itself — mostly money borrowed from Social Security revenues. Without it, the "debt held by the public" is $9.65 trillion.
According to Obama administration figures, just over $3 trillion of the $14.27 trillion debt can be attributed to Bush-era tax cuts, the wars in Iraq and Afghanistan and the Medicare prescription drug program. Stimulus spending by Obama and tax cuts he signed into law accounted for about $600 billion through last Sept. 30.
If there are no changes in government policies, the debt will soar to $18.76 trillion by 2014 and $20.8 trillion by 2016, according to administration projections.
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