Thursday, April 22, 2021

The Return Of Austerity Hysteria, Con't

 The national debt and debt ceiling are back, because they only matter if the President is a Democrat.

Senate Republicans on Wednesday signaled they might oppose any future increase to the debt ceiling unless Congress also couples it with comparable federal spending cuts, raising the specter of a political showdown between GOP leaders and the White House this summer.

Republican lawmakers staked their position after a private gathering to consider the conference’s operating rules this session, issuing what GOP leaders described later as an important yet symbolic statement in response to the large-scale spending increases proposed by President Biden in recent months.

“I think that is a step in the right direction in terms of reining in out-of-control spending,” Sen. Ted Cruz (Tex.) told reporters after the meeting.

The debt ceiling is the maximum amount the U.S. government is allowed borrow to meet its financial obligations. Congress previously agreed to suspend the limit through July 2021, at which point the Treasury Department has only a few months of “extraordinary measures” it can take before lawmakers must either raise the amount — or face the unprecedented consequences of default.

Republicans raised hardly any complaints about the debt ceiling during the Trump administration, voting frequently to increase it without requiring any spending cuts in return. Over that period, the federal debt increased by roughly $7 trillion as Trump pushed for large levels of military spending and slashed taxes for U.S. corporations.

But Republicans quickly revived their calls for austerity once Biden entered the White House, much as they had done in the past when Democrats took control in Washington. The spending concerns also contributed to GOP lawmakers’ unanimous opposition to Biden’s $1.9 trillion coronavirus relief plan earlier this year, on top of the party’s more recent apprehension about the White House’s roughly $2 trillion stimulus package.

On Wednesday, Sen. Rick Scott (R-Fla.) on Wednesday put forward the initial proposal targeting the debt ceiling, which his office described as an attempt to battle back Democrats who have sought to “spend recklessly, driving up inflation,” in recent months. It finds the conference should consider either budget cuts or “meaningful structural reform” to spending in exchange for the debt ceiling increase.

It is not clear how the policy might apply in the event Democrats seek to suspend the debt limit, rather than raise the amount. It also is not binding on the party, in keeping with the Republican conference’s other rules. Sen. John Cornyn (Tex.) later described it as “aspirational,” and Sen. Mike Rounds (S.D.) acknowledged that all of the resolutions party leaders considered Wednesday are “just resolutions,” adding: “The rules themselves are something we strive to follow.”
Republicans are betting that Democrats won't or can't use reconciliation on the debt ceiling bill this summer, and will be forced to come to the table and make trillions in immediate austerity cuts or face default, which would in fact crater the economy. Either way, Senate Republicans are hoping voters blame Biden and the Dems and give them the Senate back.

The solution of course is to scrap the filibuster and raise the debt ceiling, but that's not an option it seems thanks to Sinema and Manchin.

So we'll see.

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