Beata Zawrzel/NurPhoto via AP
According to the most recent polls, Republicans’ electoral fortunes have improved markedly over the last few weeks. Democrats went from a roughly two-point advantage in the generic congressional ballot at the beginning of October to about half a point today. It seems likely the GOP will take control of at least one chamber of Congress in 2023.
There has been a simmering debate over the past few years as to whether claims of conservative populism mean anything in a practical policy sense. Many have claimed that things have changed from the old days of tax cuts for the rich, business-friendly deregulation, and trickle-down economics—like Sen. Josh Hawley (R-MO), who once wrote, “We are a working-class party now. That’s the future.”
We now have an answer to this question, and it is firmly negative. If they win in 2022, Republicans are promising the same old massive cuts to social programs, above all Social Security and Medicare, which they’ve been trying to get at for decades. And they’re going to try to force President Biden to agree by threatening a global financial apocalypse. In the words of Roger Daltrey, meet the new boss, same as the old boss.
All four GOP representatives running to head the House Budget Committee have promised that they are going to take the debt ceiling hostage to get big cuts. “Our main focus has got to be on nondiscretionary—it’s got to be on entitlements,” said Rep. Buddy Carter (R-GA). Specifically, they mentioned increasing the eligibility age for Social Security and Medicare, and adding means tests or work requirements. Rep. Kevin McCarthy, who will probably be Speaker of the House if Republicans take control, endorsed the strategy. “You can’t just continue down the path to keep spending and adding to the debt,” he said.
To review, the debt ceiling is a legal mechanism dating from 1917 that says the government can only borrow a certain amount. So when Congress passes a budget requiring some borrowing (which is almost every time), if the resulting debt would go beyond the ceiling, Congress has to pass an additional measure to raise it. It’s as if you had a credit card with a borrowing limit that you could set yourself.
If this sounds weird and stupid, that’s because it is. The debt ceiling is a completely pointless legal archaism. The only other country that has one is Denmark, but its government rendered it inoperative years ago by raising it far above where its debt is ever likely to reach. (It’s a sad demonstration of America’s political dysfunction that we can’t even manage this kind of elementary national housekeeping.)
Despite its stupidity, should the debt ceiling be reached, it would cause a very real crisis. The Treasury Department would probably miss an interest payment, meaning a default on the national debt. Since U.S. government debt is considered about the safest possible asset in the world, and everyone from financial firms to institutional investors to central banks owns trillions of dollars of it, the hit to global economic stability would be severe. That’s why the debt ceiling is “a hostage that’s worth ransoming,” as Mitch McConnell put it in 2012 after doing just that the previous year.
Despite its stupidity, should the debt ceiling be reached, it would cause a very real crisis.
We thus see that the core of Republican economic policy remains unchanged. From the 1980s to today, it is the belief that the rich are too heavily taxed. Aside from the military, the biggest pots of money in the federal budget that might be raided for more tax cuts for beleaguered billionaires are the big welfare programs: Medicare, Medicaid, and Social Security.
Ever since Donald Trump won in 2016, there have been innumerable articles, books, and conferences discussing a promised birth of new ideas in the conservative movement. But lo and behold! It’s the exact same party of granny-starving plutocrats as before, except now with a heavy dose of even more overt homophobia, transphobia, and antisemitism, not to mention sheer 200-proof lunacy.
One might wonder why Republicans didn’t gut Social Security and Medicare when they controlled the presidency and Congress in 2017-2018, or even try to do so. (There were large cuts in Trump’s budget proposed in 2018, but they never made it into actual legislation.) The reason is that doing so is grossly unpopular. When Trump proposed huge Medicare cuts in his 2020 budget (one that was dead on arrival because Democrats controlled the House), it polled at about 72 percent disapproval. A more recent poll by a pro–Social Security organization found overwhelming disapproval for cuts to the program, and overwhelming support for increasing benefits by removing the payroll tax cap. In short, Americans love their Social Security and Medicare, and if they want changes, it is to make the programs more generous, not less.
So Republicans would much prefer to get welfare cuts through coercion and brinkmanship rather than normal legislation. That way they can starve grandma in a bipartisan fashion, while simultaneously trusting that the average swing voter will blame President Biden for it, if not sticking the blame on him themselves.
At any rate, Democrats could defuse the political pipe bomb—which they handed to Republicans themselves, incidentally—in several ways. In the upcoming lame-duck session, they could pass the reconciliation bill they still have available for fiscal year 2023, raising the debt limit to an absurd amount (I personally favor Avogadro’s number), or alternatively implement some formula that would automatically keep the debt limit in line with new borrowing.
Or President Biden could mint the famous platinum coin to increase his borrowing authority through seigniorage, or he could declare the debt ceiling unconstitutional under Section 4 of the 14th Amendment, which states that “The validity of the public debt of the United States … shall not be questioned.” This constitutional argument is surely correct—especially since Congress would be giving Biden contradictory legal instructions, requiring him to spend certain amounts through the budget process while also not allowing him to borrow the necessary balance.
Whatever choice they make, Democrats would be well advised to defuse the debt ceiling forever, before this session of Congress ends. So long as it exists, there is a live chance that Republicans will use it to do something appalling or insane.
