House Debt Ceiling Bill
voting 217 Yes 215 no the House has passed a bill which would increase the debt ceiling, slash spending, and repeal (most of) the IRA. This ends the fun period when we could laugh at Republicans for demanding that Biden negotiate without themselves making a bargaining proposal. The bill is horrible. I am a Democrat in disarray trying to figure out how to respond (and who should respond).
One possibility is to stick to the position that there should be a clean debt ceiling increase (like the 3 enacted while Trump was President). Biden has argued that a decision to honor past commitments should be separate from negotiation over future appropriations (and taxes). This has the advantage of being obviously correct. It has the disadvantage of not being new. The news is that Republicans have finally drafted a ransom note. Continuing to make the exact same obviously correct argument might seem rigid.
Importantly there are now two proposals for budgetary aspects of the debt ceiling bill 0 and not zero. I fear that there will be a compromise somewhere between the Republicans’ insane bargaining position and the Democrats very simple sane bargaining position.
I am tempted to argue that there can be two parallel tracks with Democrats proposing a 2024 budget while also arguing for a clean debt ceiling increase. If I did, I would show my ignorance, since the Biden administration has also made a proposal related to the 2014 budget (I don’t remember if it is a formal 2014 budgetary proposal or just an outline — and I am a political junky). I think Democrats should do something new.
OK who ? The ball is not officially in Biden’s court (it will arrive there when there he is sent a bill to sign or veto). I think that the Senate should consider the House’s bill (that’s what the Constitution suggests). There is a problem with a multitrack approach in the Senate as the Constitution says all tax and spending bills must originate in the House (a purely formal restriction as the Senate can and has amended minor bills with huge amendments).
I have thoughts about amendments to the House bill. I mean first delete most of it of course. Then change the set 2024 non defense discretionary spending to 2022 spending to set it to 2023 (also a sharp cut given inflation) and make other exceptions. Democrats have decided to focus on how the House has proposed slashing the budget of the Veterans’ Administration. I would propose exempting it and some other popular programs: the NIH, Pell Grants, oh and farm subsidies. What ? don’t I hate farm subsidies ? I do indeed, however, it would be very hard for rural Republicans to demand they are slashed (they have already decided that the IRA should be repealed except for the increased ethanol subsidies).
Here proposing a freeze with exceptions is just not serious — once one starts to make exceptions then it is not possible to hold the line. My proposal is absolutely not serious. The aim is to get to nothing accomplished (that is no harm done). The idea is for Democrats to propose spending cuts in the abstract (popular) with exceptions (even more popular) and create trouble for Republicans.
The other, and very key, amendment should be to combine spending cuts with tax increases on extremely high incomes. This is very popular. It fits the narrative of reducing deficits. It is absolutely unacceptable to Republicans in Congress (but is supported by about half of self identified Republicans). It is even better policy than a clean debt ceiling increase and even more popular and something Republicans are very eager to not discuss.
My hope is that faced with the risk of an actual policy debate, Republicans in the House will choose to kick the can down the road with a clean but brief suspension of the debt ceiling. And again and again and again. This means continued harm from alarming investors, but also implies continued attention to competing policy proposals (unlike the Biden administrations now forgotten proposal). I think it is the least bad strategy.
I was thinking…. but…but…but….oh, you’re not serious. so that’s okay. politics being what it is (a clown show) that’s probably the best we can hope for. or more than we can hope for.
my proposed debt solution: a deficit emergency patriotic surtax [the words are important] on incomes over, say, 200k, or a million…whatever it takes to get it passed. Thing is people whose incomes are only about two times average think they are poor. So do the people who have millions of dollars, but there aren’t so many of them. and the almost rich would be glad to stick it to them as long as they don’t think anyone wants them to pay more taxes.
so who am i to talk. i have never been anywhere near almost rich, and i don’t like taxes any more than you do. but i think i could get used to a fairly high rate as long as 1) it left me enough to live on and hope for the future, it wasn’t full of games people play to reduce their taxes, and it seemed fair…that is, everyone paid for the coutry’s needs according to their ability.
people who hate “welfare could be told all of their taxes go to defense. and people who hate defense could be told all of their money goes to welfare.
coberly
What did Dean Baker say about the rising deficit? What did Yves say to you about rescuing Social Security?
Yves said she would ban me if i didn’t stop using words like “taxes” or other words that people not enlightened by mmt use.
i don’t remember what Dean Baker said. he was probably right. i was very glad to run into him because he thinks the way i do, but knows more. while famous economists don’t.
The GOP strategem, aside from the fact that they have no hope of turning this into law, is that they are now insistent that it’s all about Savings (i.e. saving taxes that would otherwise be collected by the evil IRS army.) Where the cuts would be made will be decided later. Possibly after the next election? I guess they would like us to believe that. Meanwhile there’s still lots of voter suppression to be done by the GOP in the 30 Red states over the next 18 months.
I believe there is precedent for amending a bill and doing a total replacement of the text. That was to get around the “must arise in the House” part of money bills.
Since they have conjoined the budget and debt ceiling, do a budget in the Senate and tack on an end to the debt ceiling forever. Send it back for concurrence, or not.
Yes, Jane, I seem to recall Congress using the gambit of replacing all of a House bill with entirely new text in the Senate in order to get around the requirement that spending bills originate in the House. Unfortunately, you still need 60 votes to send that bill back to the House. If the Dems could get 60 votes, I think they should keep their position as simple as possible. How about a clean debt ceiling raise with the only condition being the beginning of serious budget negotiations through regular order. Or at least explore what other conditions might be necessary to get 10 Republican votes for such a bill.
The President has proposed a budget. The House has not. What they passed was not a budget. The President could take the position that the 14th Amendment, Sec. 4 , makes the debt ceiling legislation unconstitutional and, therefore, insist on a clean increase in the debt ceiling or threaten to ignore it altogether and insist on the House Republicans proposing an actual budget. If they want to shut the government down, they can do so by not passing a budget, but not by using the unconstitutional debt ceiling which allows them to avoid their responsibility to propose and ultimately pass a budget.
Jack:
Or we can just print more money as we are monetarily sovereign. I did not look closely at what the House passed. Thank you for bringing this to or attention. Best to just ignore the Repubs at this point. Many of the supported the insurrection.