With the debt limit deadline only days away, negotiations are stalled in the Senate over what looks to be the only way out of the crisis. The current plan that is the focus of talks would reopen the government at sequester spending levels until at least January 15th, lift the debt limit until January 31st, delay the medical device tax, and require both sides to enter formal budget talks. Dems are insisting on replacing the sequester with higher spending levels. But Republicans are balking.
So here’s what Dems should do. If Republicans refuse to budge off their insistence on lower spending levels, Dems should call their bluff by demanding a permanent disabling of the debt limit as an extortion tool as part of any short-term compromise. (Yes, Republicans will say No. But bear with me.)
If, somehow, a deal is reached this week in the Senate that involves Republicans giving ground on spending levels, Dems should make the push for a permanent disabling of the debt limit a key goal in the next round of formal, long term negotiations.
In the short term, if Dems accept sequester level spending into early next year in exchange for permanent disabling of the debt limit, it would not be an awful outcome. (Right now they’re prepared to accept sequester spending into late November.) Indeed, Norman Ornstein, a Congressional scholar who regularly decries the impact debt limit extortion has on our system, tells me he sees this as an “excellent deal.”
Such a permanent disabling could be accomplished via the previously-floated McConnell Provision, which would transfer authority over the debt limit to the president, while giving Congress a symbolic way to vote to disapprove of any hikes.
This would be good policy and good politics. It would accomplish Obama’s primary objective: Ending debt limit extortion for good. Dems believe they cannot give anything in exchange for such tactics, because so doing will legitimize them and make more such crises, and with them brinkmanship miscalculation and default, all but inevitable later. Permanently disabling the default threat would help restore some stability.
Republicans, too, could declare victory. They could say they forced Dems to the table to negotiate while maintaining sequester level spending (which they themselves have characterized as a victory). They could use the low spending level as leverage in long term talks. Conservatives could tell themselves they will use the next government shutdown deadline as leverage to undermine Obamacare.
But Republicans would never accept a permanent disabling of the debt limit, right? Maybe not, but here’s why it’s good politics for Dems to suggest this resolution, anyway.
If Republicans refuse this request, it will be a clarifying moment: It will confirm Republicans are fully intent to use the threat of default as leverage to get what they want in later showdowns. And the refusal to renounce this tactic will become what kills any hopes of a compromise. “If a deal fails on that basis, it becomes clear that Republicans are intent on using this as a weapon of extortion over and over again,” Ornstein tells me. “It changes the agenda in terms of why a deal failed.” Make Republicans defend this position.
Some Dems might argue this proposed deal gives Republicans too much. Dem aides believe if and when Republicans cave — whether by agreeing to a Senate deal that lifts spending levels, or by passing a short term clean CR and debt limit hike in the House — Dems will have effectively accomplished the goal of disabling the debt limit over the long term, without agreeing to sequester level spending. But I’m skeptical of this.
Because Tea Party Republicans view the battle against Obamacare as an apocalyptic demographic and ideological struggle to prevent a national alliance of “takers” and their Democratic enablers from transforming the country into something no longer recognizably American, they will continue insisting that GOP leaders keep up the guerrilla resistance by any means necessary — including the threat of default. (Paul Ryan has privately signaled as much.) Even if Dems are right in dismissing any future debt limit extortion efforts as empty threats, the right’s constant demand for maximalist tactics will still be destabilizing. The next debt limit deadline will — like it or not — hang over the next round of talks.
“If the debt limit becomes a regular hostage, it will inject a regular element of uncertainty,” Ornstein says. “In each case, even if each time we reach an eleventh hour deal, it will be deeply damaging to the economy.”
It’s heartening to see Dems going on offense in this fight and pressing for higher spending levels. But a permanent disabling of arguably the most potent tool in the GOP extortion arsenal — and with it, a restoration of sane governing norms — should be a goal, too.