Kevin and the Republicans
House Speaker Kevin McCarthy continues to hold the full faith and credit of the United States hostage in exchange for federal budget cuts by the Biden Administration declaring that our deficits are too big, our national debt is going to burden our children and grandchildren, and adding the old saw that, if I/we ran my/our household budget(s) the way they run the government, I/we would go broke.
By their actions neither Kevin nor the Republican Party, now or ever, has believed any part of that position except that we individuals would go broke if we ran our households the way the government budget does. Republican administrations run budget deficits by spending money on the military, big business subsidies, and tax cuts for the rich, all of which run up the debt and cause inflation (Why do you think the stock market kept going up during Covid lockdown while the economy tanked? Stock price inflation). The national debt nearly tripled under Reagan and doubled again under George W. Bush. Since Reagan’s election, Republican administrations have accounted for 57% of our entire national debt that, already, encompassed debts from a civil war, two world wars, the conflict in Korea, and Vietnam War spending.
Kevin and Modern Monetary Theory
Republicans only complain, becoming self-righteously the party of fiscal responsibility, when Democrats run the government. By their actions, the Republican party practices and believes the tenets of a liberal/progressive economic theory: Modern Monetary Theory. MMT is a neo-Keynesian economic theory that has its roots in the economic theories of John Maynard Keynes, a British economist whose economic ideas were used during the Great Depression in the New Deal by the Franklin Delano Roosevelt administration. Simply stated:
In other words, if you can print acceptable currency in your basement, you cannot go broke or go catastrophically into debt. This is exactly how the Republican Party treats federal spending when they control the government.
Kevin and the Debt Ceiling
Hence, the Speaker’s rhetoric on government spending is empty and meaningless. This is nothing more than a hostage situation. If we do not pay the ransom (make the cuts), they promise to kill the hostage (the full faith and credit of the United States).
When the government is no longer contractually able to pay its bills (in default), the federal government will shut down. Social Security, Medicare, Medicaid, tax returns, and student loan payments stop. Military personnel will not be paid. SNAP benefits will end. Pell Grant installments will not go out. The CDC, NIH, National Parks, National Museums, passport offices and most other government offices will close. Most government employees, not just nonessential ones, will be furloughed without pay (the government is the single largest employer in the country). Interest rates will spike. Steep inflation will hit fast. It will damage our credit standing around the world. It will weaken foreign faith in the value of the U.S. dollar. If they hold out for only a few days, it may throw our economy into a deep recession.
If his goal really is not about ‘fiscal responsibility’, then, what does Kevin hope to achieve by kidnapping our credit standing? If we look at HR 2617, the debt ceiling bill just passed in the House of Representatives, it will give us a clue to the Republican agenda.
If we make this deal with the devil as it stands now, it will mean steep cuts in social programs (veteran programs by 22%), tougher work requirements for SNAP benefits and other government aid, a roll back on climate change initiatives, no student debt relief, cutting the newly raised IRS enforcement budget to catch rich tax cheats, limit rural America getting broadband, cut payments to farmers for disasters and supports for rural tenants, and more. It would roll back spending to 2022 levels and cap spending increases to 1% per year for the next decade. Two-thirds of the bill is dedicated to ramping up oil and gas production.
In other words, it is pull-yourself-up-by-your-own-bootstraps for the poor and welfare for the rich and big corporations with an enormous shout out to the oil and coal barons, two of the many patron saints of the Republican Party. Regardless of their claim to be the party of ‘working people’, consistently, they support only what is good for the richest among us. H.R. 2617 is perfectly in line with their true aims.
Kevin and Terrible, Horrible, No Good, Very Bad Day
President Biden should treat this situation like any other hostage situation... and not pay the ransom. Do not give an inch. Do not make budget cuts. Do not negotiate.
After all, Republican government shutdowns have worked so well in the past. Their shutdown under Clinton only helped his reelection. The one to stop the Affordable Care Act under Obama failed spectacularly. Plus, two more shutdowns to build Trump’s wall in 2018/19, not only failed to get the wall built, but ensured Trump’s election loss in 2020.
The longer the shutdown, the closer we will get to Election 2024, the steeper the electoral price will be, the clearer it will be in a vast majority of voters’ minds who should be in charge after the election: Democrats.
We are calling your bluff, Kevin! Shut the whole place down!