Debt ceiling fight: Seems like old times

Some stories offer readers a wave of nostalgia for, er … the bad old times. Remember when budget fights between House Republicans and a Democratic president led to brinksmanship over the debt ceiling? Recall how we all laughed as our credit rating got lowered when neither side reached a compromise in time? Good times, good times.

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Well, now we can all relive it with a Republican Congress and a Republican president, Politico reports:

Republican congressional leaders are quietly preparing to pass a “clean” debt ceiling increase, according to multiple senior GOP sources — setting the stage for a high-risk showdown with rank-and-file Republicans this fall.

Trump administration officials, led by Treasury Secretary Steven Mnuchin, are imploring Congress to raise the $19.8 trillion debt limit with no strings attached by the end of September. And Senate Majority Leader Mitch McConnell and Speaker Paul Ryan — well aware they need Democrats to pass any debt bill through the Senate — are on board, albeit begrudgingly so.

But beyond the leadership, there are few Republican takers, at least so far. GOP lawmakers in both chambers of Congress are calling for any debt ceiling hike to be accompanied by spending cuts or fiscal reforms — the same demand they made repeatedly during Barack Obama’s two terms.

Why is the Trump administration asking for a clean debt ceiling increase at all? In large part, because they understand that the debt ceiling isn’t the right fight. As long as Congress keeps passing budgets that borrow 40 cents on every dollar, we will need to increase our borrowing limit. Refusing to raise the ceiling attacks the wrong end of the equation, and simply delays the inevitable. Right now, the problem is that the debt ceiling will get reached one day before the end of the FY2017 budget, which means that Congress is balking at covering the debt they’ve already planned to accrue.

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However, Republicans on Capitol Hill want to use the debt ceiling as leverage to get spending cuts in the next budget cycle. They’ve succeeded at this strategy before, but the cuts turned out to be less about shrinking government than in slowing down the rate of its growth. The real question is why this strategy is necessary at all. Republicans control both chambers of Congress and the White House. Appropriations are subject to filibusters in the Senate, but budget resolutions aren’t. The GOP should be able to unite around common-sense budget reductions and pass them along with whatever debt-ceiling increase would be necessary to match the borrowing necessary to execute the budget.

Oh, wait, I see the problem — the word unite. In fact, that turns out to be such a problem that the leaders of the party fully in charge of DC will have to ask for help from … you know who:

That means McConnell (R-Ky.) and Ryan (R-Wis.) will have to rely on Democrats and enough moderate Republicans to help them avert a financial catastrophe by Sept. 29, the day Treasury exhausts its borrowing authority and the very last day for Congress to act.

Yes, that group will certainly be amenable to spending cuts for FY2018. Yah, you betcha.

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At some point, we have to put aside the strategies and deal with reality. If Congress wants to keep borrowing 40% of its spending, it needs to raise the debt ceiling to match it rather than play chicken with the nation’s credit rating. If we want to stop raising debt ceilings, then we need to reform spending and impose a balanced-budget requirement. Do one or the other, though, rather than continue with nonsensical brinksmanship. Fish or cut bait, fellas.

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David Strom 6:40 PM | April 18, 2024
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