Perhaps worst of all for Republicans, a Democratic president and Congress are no longer intimidated by talk of rising debt, no longer cowed into accepting austerity policies. President Biden is ignoring the deficit and riding high in the polls.
So what are they to do? Some of them are contemplating an economic suicide bombing, in the form of a refusal to raise the debt ceiling:
Senate Republicans on Wednesday signaled they might oppose any future increase to the debt ceiling unless Congress also couples it with comparable federal spending cuts, raising the specter of a political showdown between GOP leaders and the White House this summer.Republican lawmakers staked their position after a private gathering to consider the conference’s operating rules this session, issuing what GOP leaders described later as an important yet symbolic statement in response to the large-scale spending increases proposed by President Biden in recent months.
This would be a rerun of Barack Obama’s presidency, when Republicans used the threat of a default on the United States’ debts to blackmail him into accepting spending cuts while the economy was still recovering from the Great Recession, making that recovery longer and slower than it needed to be.
One suspects that Democrats, including Biden, have learned the lesson of those years, which is to not negotiate with economic terrorists. But they need to go farther.
They have to kill the debt ceiling entirely. Kill it with fire. Drown it and shoot it and bury it. Strap it to a rocket and launch it into the sun. Enough is enough.
The debt ceiling is a bizarre quirk of the U.S. budgeting process that exists in almost no other country in the world. Its history dates to World War I-era conflicts between the executive and legislative branches, but what’s most important about it is that it does not determine how much debt the government takes on.
The debt ceiling is an extra vote Congress has to take. Budget and tax bills actually determine how much the government spends and takes in — and therefore what the deficit and debt will be. After that, they have to pass another bill raising the debt ceiling to cover the difference.
Until a decade ago, the debt ceiling vote was just theater: A few members of the opposition party would condemn the majority’s profligate ways and vote against it, but it would always pass. Until Obama became president and Republicans realized that if they credibly threatened to block it, the potential economic consequences of the world no longer trusting the United States’ willingness to honor obligations would be so catastrophic that it would make Obama do anything they wanted.
Of course, they had to convince him they were reckless enough to make good on the threat. But given how crazy the GOP had become during the tea party era, it wasn’t a hard sell. At one point, Standard and Poor’s downgraded America’s debt for the first time, just on the possibility that Republicans might follow through.
And now they want to put us through that again?
We have to end this madness. In the past, Congress has always raised the debt ceiling to cover the spending in the budget — but only by enough to last for a year or two, ensuring that they have to keep coming back to do it again.
So there are two ways Democrats can take care of this problem. The first is simply to write the debt ceiling out of U.S. law. Nothing about our budget will change. It won’t mean more spending or more debt, it will just mean that neither party will be able to threaten a global economic crisis to get what they want.
If they feel that goes too far, there’s another option: Keep the debt ceiling, but make this the last time they have to vote on it. They could raise the ceiling by, let’s say, 50 quadrillion dollars. It would still be on the books, but it would be high enough that we’d never have to worry about it again.
And they can do it through reconciliation, which they’re probably going to have to use in order to pass an infrastructure bill anyway.
It should have happened a long time ago. So Democrats need to take this step for the good of the country, both now and in the future. Let Republicans squawk all they want.