Brought to us by President Biden and Congress, here we go again with the worn-out series “Raise the Debt Ceiling Debate.” Although American citizens are only extras in this drama, the stakes are high for all of us.
Since 1960, “Congress has acted 78 separate times to permanently raise, temporarily extend, or revise the definition of the debt limit – 49 times under Republican presidents and 29 times under Democratic presidents.”
Biden and a complicit Congress have enacted policies “that will add more than $4.8 trillion to deficits between 2021 and 2031, or nearly $2.5 trillion when excluding the effects of the American Rescue Plan.” Biden now claims that unless a clean debt ceiling increase is approved, economic Armageddon will crush America.
Republicans, having raised the debt limit nearly twice as many times as Democrats, are now demanding real budget cuts as a concession to getting the Biden debt ceiling increase.
So, there are now two positions regarding the national debt and out of control spending.
On the one hand, defaulting on our debt will cause enormous harm to many Americans, lowering America’s fiscal standing in the world, and potentially creating an international monetary crisis.
On the other hand, Congressional Republicans are credibly claiming the debt is unsustainable and it is threatening our living standards and national security.
Both talking points are correct. And neither is mutually exclusive.
Washington Post columnist, Henry Olsen, was on our radio show, Breaking Battlegrounds, this week discussing the debt ceiling. Along with my co-host, Sam Stone, we were all sympathetic to the Republicans call for fiscal sanity.
The question is, however: What is the right vehicle for real, concrete fiscal stability? Is it the debt ceiling debate or a question of spending?
Exceeding the debt ceiling means future interest rates on the debt go up. Americans already pay $724 billion annually in interest on the national debt. That is enough to pay college tuition for every American college student.
Defaulting on the debt, therefore, means more tax dollars directed to interest payments, instead of allowing Americans to keep more money in their pocket or funding things like infrastructure. The Treasury would also have fewer buyers for U.S. debt. For everyday Americans, this means credit card rate increases and mortgage rate increases at a time of rising interest rates. This means more money out of your pocket.
This is not a good option.
Unsustainable spending is also not a sustainable path. It takes money out of taxpayer pockets and reduces funding for core government functions. The United States becomes beholden to those who hold our debt.
This fiscal dilemma is an opportunity for Congressional Republicans. They must reclaim the mantle of fiscal responsibility by drawing a line in the sand during the annual appropriation debate.
As Congressman Johnson, a South Dakota Republican said, “What in the world are we doing here if we’re not willing to have a serious conversation about spending? And that is going to mean some tension with the Senate, that is going to mean some tension with the other party, but I’m not concerned about the tension.”
After Congressional Republicans get some concreate, realistic concessions from this White House (like eliminating 87,000 new IRS agents), the real battle should be taken up during the annual appropriations debate.
This is where real leadership comes into play.
Republicans need to come up with a genuine budget deficit and national debt reduction plan. Although many in Congress presumably want to do the right thing, it will not be easy. As Congressman Dusty Johnson (R-SD) said, “it took us 50 years to dig this hole, we are not going to get out overnight.
Congressional Republicans must send a clear, uniform message to the White House:
We don’t care if we lose re-election. Were more concerned about America’s future. For providing a sound, fiscally responsible economy that provides opportunity and job creation. Unless we get a real deficit and debt reduction plan, we will vote to keep the government shut down. We cannot continue down this path. America’s future is at stake.
It is time for Republican’s to put political office and power on the line to protect America and get our fiscal house in order. It is time to “walk the walk.” No one trusts the talk anymore.