Lenin Nolly/Sipa USA via AP Images
Democratic Leader Hakeem Jeffries (D-NY) speaks about raising the debt ceiling during a news conference today on Capitol Hill.
We’ve gotten a preview of the next four years in the space of a few hours on Wednesday. Elon Musk provided the shock troops to topple an end-of-year spending deal, and Donald Trump provided the final blow. To say the commotion was based on rumor and myth would be an insult to rumor and myth; even now, Trump is calling for a “clean” funding bill while keeping the $100 billion in disaster funding and $30 billion for farmers, which comprises virtually all of the additions from a monetary standpoint.
But Trump also added an entirely new demand: take the debt limit off the table, rather than forcing him to deal with it next year. And he doesn’t just want the debt limit raised; he explicitly wants it eliminated. “The Democrats have said they want to get rid of it. If they want to get rid of it, I would lead the charge,” Trump told NBC News.
Let’s not overthink this. Regardless of who suggested it, any day we can say goodbye to the stupidest element of our political structure is a good day.
A quick recap: The debt limit is an artificial cap on U.S. borrowing capacity that can only be raised by an act of Congress. The U.S. has had this in place since 1917 and hasn’t passed more than a couple of balanced budgets in the ensuing 100-plus years. In other words, the debt limit does nothing to restrain government spending; it only attempts to limit the ability to pay for the inevitable debt incurred from that spending, after the decisions have already been made. No other country on Earth has this absurd mechanism except Denmark, and the government there managed years ago to raise it higher than it will ever reach, effectively nullifying it.
This was a mild nuisance for decades until Barack Obama decided to use the debt limit as leverage for a “grand bargain” on deficits. Tea Party Republicans recognized their good fortune: They could threaten to hold the full faith and credit of the U.S. government hostage and cause an international financial crisis if they weren’t given a ransom. Ever since, we’ve lurched from crisis to crisis whenever Democrats are in power.
Democrats’ desperate need to be seen as responsible means that the same tactics are never considered when a Republican takes the presidency. And unbelievably, in the rare moments when Democrats have total control in Washington, they’ve never bothered to defuse this bomb, only to feign surprise when Republicans take the same hostage again.
Debt limit politics are completely asymmetrical among the parties.
In the last debt ceiling crisis in 2023, Congress suspended the process until January 1, 2025, in exchange for a two-year spending cap and, among other things, an ongoing leakage of IRS enforcement funds that could see nearly all of that money drained. In other words, the ransom deleted a major Democratic agenda item, something that could not have happened without the hostage scenario.
Republicans already had a plan to handle the upcoming expiry of the debt limit with their trifecta next year. Extraordinary measures from the Treasury Department would take the borrowing cap to next summer, and the GOP leadership planned to tuck a debt limit increase into the initial reconciliation package.
But Donald Trump is for some reason scared of debt limit increases happening on his watch. Maybe it’s because he knows right-wing House Republicans will never vote to raise the debt limit, still wrongly believing it to be a shield against runaway spending. Maybe it’s because he knows his base aligns with that incorrect argument, including shadow president Elon Musk. Maybe it’s because he just doesn’t want any limitations on presidential power. Or maybe he actually recognizes that the debt limit is stupid optics that serves no purpose. That’s what he said to NBC, anyway: “It doesn’t mean anything, except psychologically.”
The solution he’s stumbled into is to just eliminate the thing. And that would be the absolutely correct solution. Sen. Elizabeth Warren (D-MA) has been practically one of the only Democrats encouraging the troops to “fight every fight in Congress,” yet her reaction to Trump’s suggestion was immediate and unequivocal: “I agree with President-elect Trump that Congress should terminate the debt limit and never again govern by hostage taking.”
By contrast, House Minority Leader Hakeem Jeffries (D-NY) chose to connect to Republican efforts to cut Social Security: “GOP extremists want House Democrats to raise the debt ceiling so that House Republicans can lower the amount of your Social Security check.” There’s some truth there, but it lazily looks to the customs of how these debt limit fights commonly play out.
If the Republican offer is to stick a debt limit increase into whatever end-of-year funding bill they have, then Jeffries is right: Republicans should bear the full burden of passing that, on the theory that you should hand your opposition an anvil at every opportunity. You’re not going to get much out of that, though. It’s pretty clear that voters don’t make their decisions based on who supported a debt limit increase at some point in their congressional career.
On the other hand, if the offer is to eliminate the debt limit because Dear Leader Trump said so, Jeffries should co-sponsor that bill. Everyone knows that Democrats aren’t going to demand some preservation of Social Security upon threat of a financial crisis; that threat isn’t credible. Debt limit politics are completely asymmetrical among the parties. And so elimination strongly favors the left side of the aisle.
Since Republicans can’t agree on how to resolve this standoff, Democrats should roll up their asks into one: If Republicans kill the debt limit, they would get Democratic votes for a so-called “clean” continuing resolution. (Which probably has to include disaster relief and an extension of the farm bill, all of which Trump has endorsed.) The benefits of ending hostage-taking are pretty great, much higher than the small ball that Democrats had been seeking. And the final bill would perfectly line up with Trump’s stated goals.
Democrats aren’t going to get a lot of wins in the Trump era. Getting one through the back door of the Biden era would be pretty great.
