There is nothing novel, let alone heroic, about Treasury Secretary Steven Mnuchin’s call for Congress to pass an increase to the statutory debt limit with no strings attached. That has been the institutional position of every Treasury Department in both Democratic and Republican administrations for decades.
What stands out, however, is the Trump administration’s muddled and inept approach to an issue so critical to America’s financial security. President Trump has been largely missing in action, instead turning the job over to a Washington novice stretched thin with other workload requirements, including the daunting challenge of achieving tax reform in a politically fractious climate. White House abdication on the debt limit is risky business.
Failure to raise the ceiling has consequences. Think stock market crash. Think global financial chaos. Think rising interest rates and an economy going down the tubes.
Raising the debt ceiling, although essentially a ministerial legislative act, involves heavy lifting. It’s a lesson I learned all too well as a Treasury Department deputy assistant secretary for legislative affairs in my early days with Jimmy Carter’s administration. Our initial efforts in February 1979 to raise the ceiling were shot down in Congress by members eager to show folks back home that they were fiscally frugal. Not that the lawmakers didn’t know better.
The debt limit has nothing to do with new spending. Voting against the bill, however, was a cheap political “show” vote. The debt ceiling was eventually raised in 1979, as has always been the case, at least up until now. But getting it done required the president’s full attention at the plate — as Ronald Reagan, George H. W. Bush, Bill Clinton, George W. Bush and Barack Obama found out during their times at bat. There was no cooling it in the dugout. (Sorry, baseball fans.)
Mnuchin is a beseecher. A commanding figure is needed on the scene. Where has the Trump administration been all this time? Getting clean debt-ceiling legislation requires a herculean effort, especially out of those congressional Republicans who believe sabotaging the government is good for the country. The greatest threat to raising the ceiling unconditionally is found within Trump’s own party.
It certainly doesn’t help to have a president who can’t tell the debt ceiling from ceiling tile, who is fixated on the Russia investigation and who cares more about making himself look good.
And it looks even worse when the president’s director of the Office of Management and Budget, Mick Mulvaney, has acted as a public cheerleader for tying a debt-limit increase to fiscal reforms favored by hawks in the House Freedom Caucus, where Mulvaney once held forth. That Trump was so cavalier about his treasury secretary getting stabbed in the back by his OMB director only underscores the magnitude of the problem caused by his inattention. Fortunately, after getting the word from the White House that Mnuchin “speaks for the administration” on the debt ceiling, Mulvaney this week saluted, silenced his foghorn and executed an about-face. At least in public.
Meanwhile, Mnuchin, late to the game and a stranger to the ways of Congress, plows on, bringing no special insights or arguments that haven’t been heard before. The treasury secretary wages forth with bureaucracy-supplied talking points doing what he is required to do.
I sang this tune in the Carter years, and sang it again about Obama’s go-round with Congress over raising the debt ceiling in 2011 (choir, in unison): Increasing the debt limit allows the country to meet its obligations — already authorized by Congress — to holders of U.S. debt, including foreign countries; to Social Security recipients; and to all other creditors. (Be seated.)
Even the most doltish, bird-brained legislator on either side of the Capitol knows that it is essential that the United States meet its legal obligations. Every member of Congress understands the danger of a U.S. debt default — I just gotta believe that.
Yet we are once again, as a country, about to be subjected to another “Perils of Pauline” debt-ceiling cliffhanger in which the financial system is placed at the point of death to only, I hope, escape at the end. That is, if this president, who takes apparent maniacal delight in pulling wings off butterflies in the form of Attorney General Jeff Sessions, former chief of staff Reince Preibus and former press secretary Sean Spicer, awakes to his obligation to protect the full faith and credit of the United States, and gets to work. We live in hope.
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