Normally, I would focus on the GOP campaign for the presidency, but the issue of the debt ceiling is on the forefront of most people's minds, so I'll focus on that.
Since 1939, before the major US involvement in WWII, there has been a "ceiling" on the amount of money that the US government is allowed to owe. As of this posting, the "ceiling"$14.46 trillion. Most of the debt that the US owes is actually to the citizens and states in the form of government bonds. About 47% of the debt is owed to other countries, like China (at about 14%).
For the past six months in the USA, the major question has been the debt ceiling, whether to raise it or not. The GOP controlling the House at first insisted that the ceiling should not be raised under any circumstances. Now, their argument is that they would consider raising the ceiling, but not without substantial budget cuts (always to education or public programs but never with an eye on wasteful defense spending) and absolutely under no circumstances with a cent raised in taxes.
The Democrats, currently in direct leadership from President Obama have argued that nearly anyone with half a brain on the issue knows that the best way of dealing with the debt situation is to take a balanced approach. Substantial cuts, sure, but there has to be an increase in revenue. The GOP have staunchly refused. They won't even look at the possibility of closing tax loopholes for higher income tax brackets.
Think about that. The law is already on the books. The GOP bemoan that the tax on corporations in the US is the highest in the industrialized world (it's not: Japan's stands at 40%) and ignore the fact that the rate is topped at 35% and that most corporations don't pay that much. GM, Bank of America and Citigroup (the major recipients of gov't funding in the previous few years) paid no taxes and BOA got a tax return to the tune of one billion. By closing loopholes, they simply making the requirements that are already expected of the corporations in the US.
The tragedy of a democratic republic is that, at some point, you're going to have to compromise. To compromise means that you get something that you want, but you have to give something up in the meantime. Give a little, take a little. Here with the debt crisis, the GOP have a chance to show that they are reasonable people who are capable of governing. But they're throwing the chance away. They are almost going out of their way to make it easier for Obama to get re-elected.
While all this back and forth is going on, an intriguing legal argument is coming up. The 14th Amendment, which by and large deals with equal rights and the citizenship status of those in the US, but also deals with the question of public debt. Originally, the clause was inserted to protect the Federal government from people looking to collect money that they had lent to the Confederacy. In the early 20th century, the Supreme Court went a step further and said that the public debt extended to all the debt that the US government owed. So, the debt ceiling is unconstitutional and, in another sense, those that pursue to maintain it are acting unconstitutionally. Which may seem strange for the Republicans, the party that passed a measure that would require that all laws cite what part of the Constitution they draw their powers from, but the GOP have always been selective in their outrage.
So, the real opportunity for the GOP in this instance is to follow the writing of the Constitution and remove the debt ceiling entirely.