Congress heads back to Washington, D.C., next week, to be greeted by yet another analysis of the debt ceiling risk. The Bipartisan Policy Center, an independent think tank, is warning along with all the other non-partisan entities saying that the government will be out of cash in “summer or early fall,” depending on April’s tax receipts.
That deadline “will depend heavily on 2022 tax collections in a fragile post-pandemic economy with low unemployment, persistent inflation, and recession fears,” the center said in statement. With insufficient tax receipts, the center said, the nation could face a “’too close for comfort’ situation prior to quarterly tax receipts due on June 15.” Because that’s what the government uses to function: tax dollars. This is a fact that Republicans like to pretend is not true.
“I am optimistic that today’s projection provides Congress and President Biden with a window of opportunity to come together and work out a deal,” Shai Akabas, the center’s director of economic policy, said in a statement. “They owe it to every hardworking American and small business owner to avoid the costs and risks associated with dragging this out to the 11th hour.”
It’s true that there’s an opportunity. It’s also true that it is the absolute least Congress should do—not to put the nation through absolutely unnecessary economic trauma. But half of Congress comprises either nihilistic maniacs or people too scared of them to work with Democrats. So, good luck with that optimism.
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Axios counts 16 Republican House members who have been in office since at least 2017 and have never voted to raise the debt ceiling, even under the former guy. That group includes Reps. Andy Biggs (R-AZ), Matt Gaetz (R-FL.), and Ralph Norman (R-SC), those who forced Barely Speaker Kevin McCarthy to endure 15 votes to get the gavel, their way of letting him know it’s only on loan to him for as long as he does their bidding.
Perhaps to increase pressure on the returning Congress, on Wednesday, the Federal Reservereleased the minutes from its last Federal Open Market Committee meeting which took place at the end Jan. 31-Feb. 1. “A number of participants stressed that a drawn-out period of negotiations to raise the federal debt limit could pose significant risks to the financial system and the broader economy,” the minutes read.
“A number of participants noted the importance of orderly functioning of the market for US Treasury securities and stressed the importance of the appropriate authorities continuing to address issues related to the resilience of the market,” the minutes continued. “Although several participants noted that the Federal Reserve’s standing liquidity facilities could be helpful in addressing significant pressures in funding markets, should they arise, several participants also noted the challenges of addressing potential disruptions in US core market functioning,” the minutes said.
In other words, Congress needs to fix this. Now. Good luck with that, too.
The House maniacs seem unlikely to return next week with any kind of plan for doing that. As of yet, there’s nothing except the whack-job plans of the whack-job former Trump Office of Management and Budget Director Russell Vought. He is most definitely driving the train, serving as what passes for the “intellectual leader of the GOP’s conservative flank.”
His vision: “cutting $9 trillion over the next decade from thousands of domestic programs—slashing funding for government agencies, student loans, and anti-poverty programs such as housing, health care and food assistance—while urging Republicans to attack the ‘woke bureaucracy.’” He also wants to freeze defense spending, which might be where he loses a decent chunk of the GOP. He’s got a budget, though, that McCarthy and team may or may not be cribbing from.
The plan includes $2 trillion in cuts to Medicaid, the health program for the poor; more than $600 billion in cuts to the Affordable Care Act; more than $400 billion in cuts to food stamps; hundreds of billions of dollars in cuts to educational subsidies; and a halving of the State Department and the Labor Department, among other federal agencies. While congressional Republicans have yet to release a budget plan, House GOP lawmakers are weighing cuts to these programs as a way to reduce the debt without touching Medicare and Social Security.
I’m sure the nation’s seniors with be thankful to be living in the dystopian ruins of society, knowing that their Social Security check is there for them—if only there were a government functional enough to deliver to them.
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