It’s not difficult for Democrats and Republicans alike to list multiple reasons to hate the debt limit agreement reached over the weekend by House Speaker Kevin McCarthy and President Joe Biden. The irony, of course, is that the partisans are often clucking about the same issues, just opposite takes on them. Expanded work requirements for those who are eligible for the Supplemental Nutrition Assistance Program (SNAP) and the Temporary Aid for Needy Families program is a particularly galling imposition given how experience shows it won’t help recipients get jobs but will increase government bureaucracy. Meanwhile, there are any number of House Republicans who are wondering, “Is that all?” In return for suspending the nation’s $31.4 trillion borrowing limit until early 2025, they’ll get two years of caps on spending followed by nonbinding spending targets. This gives Speaker McCarthy an opportunity to brag about $1 trillion in reduced spending over the coming decade, but it’s based on the expectation that those in charge of the White House and on Capitol Hill after 2024 will go along with those targets. In other words, big whoop.
Make no mistake, there is some real discretionary belt tightening here — although not from the Pentagon, which was granted something of a pardon with bigger military budgets this year and next. The Internal Revenue Service takes a hit. There’s the work requirement that narrowly hits food stamp recipients ages 50 to 54 who don’t have children living with them. There is also a formal end to student loan repayment freezes. Why hungry poor people and students struggling with debt need to be targeted in such a manner will be for GOP candidates running for office to explain on the campaign trail, one presumes. Here’s the obvious question for them: Is this why the full faith and credit of the United States had to be put at risk through the House GOP’s refusal to approve a “clean” increase in the debt ceiling as was done routinely by Republicans in Congress when there was a fellow Republican in the White House?
President Biden’s best pitch for the compromise is this: It’s more or less what the White House and the House GOP leadership would have negotiated in the normal (well, closer to normal) budgeting process. The logic here is that Biden didn’t bow to the hostage-taking of the debt ceiling limit, he simply made the kind of concessions that would have been required down the road. Will progressives buy that sales pitch? The good news for Democrats is in what the agreement doesn’t cut. Social Security, Medicare and Medicaid and the Inflation Reduction Act (with its investments in green energy and lower prescription drug prices, for example) to name some of the potential targets that were out there. The bad is that it still gives the appearance that whenever Republicans really, really want something, they need only threaten government default. They did it in 2011 after the Tea Party election in 2010 (with the U.S. credit rating taking a downgrade as a result) and unsuccessfully in 2013 to try to derail Obamacare.
By accepting this compromise will Congress be rewarding an unacceptable level of brinkmanship? Alas, the obvious answer is yes, they will. Yet to reject the agreement is much, much worse. The damage that would be done to the U.S. economy — and to the world economy — by an inability to pay bondholders (once those “extraordinary measures” of the U.S. Department of the Treasury are exhausted in the coming days) would be real and long-lasting. In Hollywood, action heroes rescue the innocent hostages when they have a gun to their head. In the real world, sometimes deals have to be struck with malefactors. Speaker McCarthy said he was never going to pull that trigger anyway. Who believes him?
Still, a chance to hold the instigators accountable is coming. If Americans want to put the future on this country in saner hands, they’re going to have to make some important decisions at the ballot box. On Tuesday, Nov. 5, 2024, they’ll have a final say over whether to reward or punish those who acted responsibly in this matter and those who did not. We should not have to tolerate these insanely irresponsible Dooms Day tactics ever again.
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