That two-track strategy has fared better than expected, even if at times the process has appeared chaotic. But they’re about to be placed alongside a third track, one that President Biden and congressional leaders have not been preparing for with nearly as much precision. This one raises the specter of a federal government shutdown and, if cooler heads don’t prevail, a possible default on the federal debt that would probably wreak havoc on the financial markets.
Before either of those first two efforts are likely to be completed and signed into law, Congress must face a Sept. 30 deadline to extend funding for federal agencies to keep operating. And then, sometime in October or November, based on Congressional Budget Office estimates, the Treasury will hit its limit in terms of managing the $28 trillion debt.
For now, Senate Minority Leader Mitch McConnell (R-Ky.) has declared that Republicans will not provide a single vote to lift the debt ceiling.
“They have the House, the Senate and the presidency. It’s their obligation to govern. And, you know, the essence of governing is to raise the debt ceiling to cover the debt,” McConnell told The Washington Post’s Mike DeBonis in an interview Tuesday.
At this stage, the Democratic strategy appears to be trying to shame McConnell into backing down, exposing the utter hypocrisy in his newfound unwillingness to raise the debt limit.
“Look, let me just say this: I cannot believe the Republicans will let the country default, and it has always been bipartisan to deal with the debt ceiling,” Schumer told reporters Wednesday.
Later Wednesday, Biden brushed off any worries about the looming deadline. “They’re not going to let the U.S. default,” Biden said of Republicans.
And Sen. Bernie Sanders (I-Vt.) targeted McConnell’s past commitment to responsible governance of the national debt as proof for why the issue should not turn into a partisan standoff.
“You may have heard him say a million times, quite correctly, that for the United States government not to pay its debts is, I think the word was unthinkable. He’s right, it would be unthinkable,” Sanders told DeBonis on Wednesday.
It’s true, McConnell and Republicans happily raised the debt limit several times during the Trump presidency. The day after the 2014 midterm elections gave Republicans the Senate majority, he declared that the days of fiscal brinkmanship should be left in the past.
“There will be no government shutdown, no default on the national debt,” McConnell told reporters Nov. 5, 2014.
And a year later, McConnell clinched a bipartisan budget deal with President Barack Obama that included a suspension of the debt limit well into 2017.
But McConnell is an experienced legislative poker player. He is always comfortable if his opponent’s biggest argument is that he is being hypocritical, the type of process argument in which he drags his opponent into a gutter of obscure parliamentary procedure that most voters just tune out.
A decade ago, as a far-right faction of tea party Republicans pushed GOP leaders to actually breach the debt ceiling, McConnell stepped in and negotiated a 10-year budget deal that reined in government spending — a deal he negotiated with then-Vice President Biden.
“I think some of our members may have thought the default issue was a hostage you might take a chance at shooting. Most of us didn’t think that. What we did learn is this: It’s a hostage that’s worth ransoming,” McConnell told The Post in August 2011.
No other global economic leader has such a debt ceiling, and many budget experts would rather eliminate it altogether. Yet each party, when out of power, has taken it as a political hostage, with Republicans being more ruthless.
The debt ceiling is so unpopular with members of Congress that it never gets consideration on its own. It’s always tacked onto another must-pass bill that lawmakers point to as their defense of voting for this unpopular debt extension.
Lawmakers so disliked voting to raise the limit, usually by multi-trillion-dollar amounts, that Congress has in recent years instead opted to suspend the debt limit to a certain time. That’s considered less potent for political opponents who would run attack ads against lawmakers for such free spending ways.
But that debt suspension is available only through a “regular order” approach that would require at least 10 Senate Republican votes to choke off a filibuster.
That’s why some liberals have advocated for including a debt increase in the partisan budget bill, which would require a specific dollar amount of new borrowing authority.
Dan Pfeiffer, a senior Obama White House aide during those debt fights with McConnell, argues for a “pull the Band-Aid off” approach and just adding an increase of the debt ceiling into the budget bill.
Democrats will already be voting for a $3.5 trillion budget plan — will voters really be that much more upset if there’s an additional $2 trillion to $3 trillion in borrowing authority?
But as Schumer and Sanders made clear Wednesday, Treasury Secretary Janet L. Yellen and White House officials have opposed that plan so far.
One major reason is, if the debt ceiling language were included in the massive budget plan, it would create a concrete deadline for passing the most ambitious domestic policy agenda in almost 60 years.
While Schumer has set Sept. 15 as the tentative deadline for the next action on the budget bill, it could take until Thanksgiving or Christmas to properly assemble and corral the votes for final passage of the massively ambitious legislation.
Which would probably be past the “zero hour” of borrowing authority and risk a default and downgrade of U.S. bonds that would lead to financial calamity.
That leaves only two other train cars this year to add on the debt suspension, both of which are high-stakes moves.
The bipartisan infrastructure bill has moved over to the House, where Speaker Nancy Pelosi (D-Calif.) has declared she will hold it hostage until the Senate finishes acting on the partisan $3.5 trillion budget plan.
She could push to amend that bill, add in a debt limit suspension and send it back to the Senate, daring the 19 GOP senators who crossed the aisle to support that legislation to either approve the new borrowing authority or watch their bipartisan infrastructure bill collapse.
More likely, Democrats will add the debt suspension onto a temporary funding bill to keep government open at the end of next month.
If Republicans object, it would lead to federal agencies shuttering Oct. 1. And Biden and McConnell would play a game of political chicken, trying to blame the other side as the zero hour for debt borrowing loomed just days or weeks in advance.