Back again for another edition of “As the Default Clock Ticks”. Here are some previous editions if you need and would like to get up to speed:
1. Debt Ceiling Options: Default, Cave, Discharge Petition or DARK BRANDON To The Rescue
2, THIS WEEK IN CONGRESS: The Clock Is Ticking Towards Default Day
3. THIS WEEK IN CONGRESS: As the Default Clock Ticks - House POS Bill Passes, Now What?
4. As the Default Clock Ticks - Cave, Discharge Petition, a Senate Bill or Dark Brandon to the Rescue
To get you up to date, we have until the end of May before the Nuclear Default Bomb goes off (according to Treasury Secretary Janet Yellin), but there will likely be some small precursor explosions before then (US credit devaluation, etc.), if nothing is done.
Congress is only scheduled to be in session this week and part of next week. So if Congress is going to do anything to defuse the default bomb, that’s the window they have to do it at this moment.
After Biden and Congressional Leaders met early last week, they cancelled a planned Saturday meeting to let staff continue to negotiate. Now there is another meeting scheduled for today.
Oh, did I mention that Biden is scheduled to jet out of the country on Wednesday to a G7 economic summit in Japan.
So where do things stand? Beats me! But here are Biden’s latest remarks on the situation curtesy of CNN:
Deputy Treasury Secretary Wally Adeyemo told CNN’s Dana Bash on “State of the Union” on Sunday that talks between the two sides have been “constructive.”
Biden, Adeyamo said, “looks forward to getting together with the leaders to talk about how we continue to make progress.”
Biden himself indicated on Sunday that he expected principal-level debt ceiling discussions to take place Tuesday.
“We’re working on it right now,” he said in brief remarks to reporters as he completed a bike ride in Rehoboth Beach, Delaware….
Biden expressed optimism Sunday for an eventual agreement.
“I remain optimistic because I’m a congenital optimist. But I really think there’s a desire on their part, as well as ours, to reach an agreement. I think we’ll be able to do it,” he said in Rehoboth Beach.
And here’s what Barely Speaker McCarthy is saying, curtesy of US News:
House Speaker Kevin McCarthy said Monday there's been “no progress” on debt ceiling talks ahead of a meeting with President Joe Biden on Tuesday at the White House, as the country pushes closer to a crisis over the need to raise its legal borrowing limit…
“It's very concerning to me,” McCarthy, the Republican speaker, told reporters as he opened the House chamber.
“There’s no progress that I see,” he said of the staff-level talks that extended through the weekend. “And it really concerns me with the timeline of where we are.”
Doesn’t sound like Biden and McCarthy have been attending the same meetings, does it?
So What’s Going On?
The answer is, no one really knows, but there are a few things that seem to be fairly certain:
1. Biden would definitely like this to be resolved through Congress. Keep in mind that Biden is a creature of the Senate and has a firm belief that given a deadline, Congress always finds a way to negotiate a deal. He also knows it is the least politically, economically and legally messy way to resolve the current debt limit crisis.
2. Democrats are still working on a Discharge Petition to get a clean 2 year debt ceiling raise bill out of Committee and onto the House Floor for a vote. Last I heard, today is the day the Bill becomes “ripe” (meets the 30 legislative day rule for sitting in Committee) and an actual Discharge Petition can be circulated for signatures. So look for that to be going on behind the scenes. Still no indication that there are at least 5 Republicans willing to sign in order to get the needed 218 signatures. But as the bombs timer clicks closer to default detonation, a few Republicans from purple Districts concerned about their own political futures might sign on.
3. Biden is NOT going to let the Country Default! If negotiations fail on a compromise bill and Dems. can’t get enough Republicans to sign a Discharge Petition on a clean bill, Biden will have no other choice but to use the 14th Amendment option (Dark Brandon to the Rescue). While Biden continues to downplay the use of this option, he has not taken it completely off the table. I remain confident that if it comes down to default or the 14th Amendment, Biden will not choose the former.
4. Biden and the Dems. will not agree to McCarthy’s POS Spending Cuts Bill or anything even close to it. Rumors from negotiations suggest that Biden is agreeing to some innocuous spending cuts that would do little harm and some would be in latter years where they could possibly be restored down the road. Whatever deal emerges, if any, it won’t be one that decimates Biden’s signature economic accomplishments. However, another sticking point appears to be the length of the debt ceiling raise. Democrats would like it to be enough to get us through 2024 and past the elections, while Republicans want another chance at debt hostage taking in 2024 before the election.
5. McCarthy is in a box, that he can’t get out of without the help of Democrats. There is no deal he can make that will satisfy the MAGA Crazy Free-dum Caucus in his Party and prevent them from seeking his ouster. So he will need Dem. votes to pass any negotiated debt ceiling bill and to subsequently vote for him to retain the Speaker’s gavel. Dems. voting for him to remain Speaker seems highly unlikely after he has treated House Dems. like crap since he took the gavel (booting some off Committees for fabricated reasons). The only ways he can avoid losing his precious Speaker’s Chair is if a Discharge Petition succeeds or if Biden uses the 14th amendment, which is why I suspect he is secretly routing for either of these two options,
In closing, I have to ask, that with the exception of Janet Yellin, am I the only one who is running around with his hair on fire over this?
To her credit, Joan McCarter has done a great job covering this looming crisis. Her most recent post does a great job of bitching at the media for their lack of coverage and explaining some of the horrifying ramifications of a default. But from the MSM, seems to be more interested in the latest Trump legal scandal than in the ticking economic nuclear bomb in Washington. Maybe it’s because we have seen this bomb ticking several times in the past and it always gets defused at the last minute because no one really wanted it to go off. But this time there are a few MAGA crazies in the House that really want it to go BOOM, which is what makes this so scary.
So for now, I will be staying in a curled up fetal position hiding under my desk.