Congress yesterday announced they had reached a debt ceiling deal: a one-time rejiggering of the filibuster rules so Democrats can raise the ceiling with only 51 votes in the Senate. It's a short-term victory for Congressional leadership, and for the country, which now won't be plunged into a pointless, brutal recession in the middle of an ongoing public health crisis.
In the long term, though, the entire struggle over the debt limit is a bleak reminder of how Republicans have broken our political system. Rather than work on real solutions to real problems, the debt-ceiling debate shows how the GOP has abandoned actual policy solutions, waged war on budgeting and embraced compulsive vice-signaling to their base.
The GOP generally insists they don't want to raise the debt ceiling because it want to be fiscally responsible. Texas Senator Ted Cruz, for example, said he wouldn't support raising the debt limit because it would allow "Democrats to add trillions more in debt." Republicans, then, claim they're using the ceiling to prevent more Democratic spending.
The problem is that this completely misrepresents what the debt ceiling is. As Steve Benen explains, "raising the debt ceiling allows the United States to pay its bills, not to clear the way for new spending."
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The federal government uses a mix of tax revenue and borrowing to pay its outstanding obligations – federal employee salaries, social security checks, Medicare reimbursements, payments to defense contractors. The debt ceiling prevents further borrowing, which means the government no longer has access to the money it needs to pay its bills. It's like saying you're going to eliminate your credit card debt by quitting your job.
In practice, a failure to raise the debt ceiling would be a form of government shutdown. Except the economic consequences would be even worse than a shutdown, because the government has less discretion to protect, for instance, social security payments.
Josh Bivens at the Economic Policy Institute estimates that failing to raise the debt ceiling would result in an instant spending cut of 8 percent of GDP. Compare that to the Great Recession of 2008-2009, in which spending dropped 9 percent over two years. Moody's warned that international investors would no longer have faith in American credit and would demand higher interest rates on Treasury bonds, creating a permanent drag on the economy.
In short, failing to raise the debt ceiling would result in a completely unnecessary economic disaster. So why do Republicans keep grandstanding on the issue?
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Some Republicans probably don't understand what the debt ceiling is. At least since the 1990s, when House Speaker Newt Gingrich set out to systematically ax Congressional staff and sweep away institutional expertise, Republicans have celebrated policy ignorance.
Right-wing media will back Republicans no matter what silly thing they say, even unto injecting bleach. So there's little incentive to keep up on complex, or even simple, policy issues. Far-right Congressmember Marjorie Taylor Greene blamed forest fires on Jewish space lasers. It's not much of a stretch to suggest she is also confused about how the debt ceiling works.
The debt-ceiling struggles are also part of what political scientist Jonathan Bernstein has been referring to for years as the Republican "war on budgeting." Bernstein explains that Republicans have abandoned any effort to balance federal income and expenditure.
"For Republicans," Bernstein says, "'deficit' simply means stuff they don't like, and what the federal government spends doesn't have anything to do with what the federal government raises."
Bernstein could have substituted "debt" for "deficit" there and the point would remain the same. Republicans don't actually have any interest in balancing budgets or reducing debt. If they did, they would not have passed Trump's massive tax cuts, which bloated national debt by $7.8 trillion. When Ted Cruz postures about the debt ceiling, he's not saying he wants fiscal responsibility. He's demanding that the government adopt his spending priorities.
Those priorities include the usual Republican wish list – tax cuts for billionaires, more money for defense. But even more crucially, they include a blanket desire to cut payments to all those the Republicans deem unworthy, which is basically everyone except wealthy white men.
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Cruz, for example, has tried to delegitimize Social Security by calling it a "Ponzi scheme." (Social Security is not a Ponzi scheme, ffs.) When asked what workers who were struggling during the pandemic should do when their unemployment benefits run out, Cruz responded, "Um, get a job."
Cruz's swaggering tough-guy callousness in the face of a global public health crisis that has killed almost 800,000 Americans isn't some sort of mistake or miscalculation. As Adam Serwer has written, "the cruelty is the point."
When Cruz and others oppose the debt ceiling, they are engaging in what we might call "vice-signaling." They aren't actually promising to help anyone, or to make the country more stable, or even more virtuous. They're mostly promising to hurt people Republicans believe should be hurt – poor people, jobless people, homeless people, disabled and elderly people, Black people and, for that matter, federal employees.
The irresponsibility and ignorance of their caucus is ominous, as is their vindictiveness. We're still in the middle of a terrifying global pandemic. Yet Republican lawmakers are obsessed with showing that they want to help people less, or not at all. They've shown that they think hurting huge numbers of people is a positive good. The fact that they've momentarily decided not to do that by defaulting on the debt is a relief. But they will unfortunately have other opportunities.
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