As for a budget that would back up their hostage demands on the debt ceiling? Fat chance. Even The New York Times, which has been steadfastly committed to both-sidesing the GOP’s economic terrorism, is reporting that the GOP’s got nothing.
Republicans have insisted that they want “structural” fiscal changes in exchange for voting to raise the borrowing cap, but they have so far declined to offer a cohesive plan outlining what programs they would cut. Internal divisions over how to reduce spending have been spilling into public view, underscoring the political challenge that Republicans face as they try to wield the specter of a default to extract concessions from President Biden and Democrats.
But let’s talk about what they are threatening to do to the American people by inviting a default, by actually planning for a default.
Here’s Mark Zandi, chief economist of Moody’s Analytics:
A default would be a catastrophic blow to the already-fragile economy. Global financial markets and the economy would be upended. Even if it is quickly resolved, Americans likely would pay for this default for generations, as global investors would rightly believe that the federal government’s finances have been politicized and that a time may come when they would not be paid what they are owed when owed it. …
[I] if lawmakers do not reverse course and the impasse drags on for even a few weeks, the hit to the economy would be cataclysmic. Most immediately, the federal government would have to slash its spending. Say the debt limit was breached on October 1 and dragged on all month. The Treasury would have no choice but to cut government spending by an estimated $125 billion. And if there is no agreement in November, another close to $200 billion in spending would need to be cut. The hit to the economy as these government spending cuts cascade through the economy would be overwhelming.
Which would not be great for the American people. At all.
It would also be disastrous for Republicans in 2024, which is likely not being lost on the non-maniacs in the GOP. They’ll find backup in the White House, the Democratic Senate, and their Democratic colleagues in the House, if they can find their spines.
Sign and send the petition: NO HOSTAGE TAKING for the debt ceiling.
Listen to the latest episode of The Downballot for an in-depth analysis of the 2024 Arizona Senate race and the implications of Kyrsten Sinema's re-election decision. Special guest Victoria McGroary, the Executive Director of BOLD PAC, will also discuss the efforts to prevent losses among Hispanic voters and the fight against disinformation in Spanish language media.
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