President Joe Biden invited the “four corners” of Congress—the Speaker and majority and minority leaders of the House and Senate—to a White House meeting on May 9 to talk debt ceiling on the heels of a new deadline announced by Treasury Secretary Janet Yellen. That so-called X-date—the last day Treasury can keep shuffling funds around to service the national debt—could be as soon as June 1. That’s very soon. There are only about eight days of overlap in legislative work days between the Senate and House for the whole month of May.
Biden got out in front on the messaging for next week Monday. “America is not a deadbeat nation,” Biden said at a Rose Garden event. "We pay our bills and we should do so without reckless hostage-taking from some of the MAGA Republicans in Congress.”
McCarthy is just as adamant that he won’t release the hostage of the full faith and credit of the United States. “The only way you solve problems is you negotiate,” he said, speaking from Jerusalem, where he’s playing statesman. “And I'm looking forward to the president changing his mind and negotiating with us.”
McConnell, the original debt ceiling terrorist, has washed his hands of the whole thing. He had no statement after the invitation, letting his remarks from last week stand. “The president knows how to do this,” McConnell said then. “Until he and the speaker of the House reach an agreement, we’ll be at a standoff." He is, presumably, going to attend next week’s meeting. Whether this supposed great “institutionalist” will do anything to stop McCarthy and his Freedom Caucus from crashing the economy remains to be seen.
Here’s a relevant blast from the recent past, when Republicans decided they didn’t need to play the debt ceiling hostage game. But the rules are always different for a Republican president.
“I said, I remember, to Sen. Schumer and Nancy Pelosi, ‘Would anyone ever use that to negotiate with?’ They said ‘absolutely not.’ That’s a sacred element of our country. They can’t use the debt ceiling to negotiate.” What a difference a presidential election can make when you’re a Republican.
Democratic leaders Chuck Schumer and Hakeem Jeffries issued a joint statement backing up Biden’s stance that paying the nation’s debts isn’t up for negotiation. "We do not have the luxury of waiting until June 1 to come together, pass a clean bill to avoid a default and prevent catastrophic consequences for our economy and millions of American families," they said. "Republicans cannot allow right-wing extremism to hold our nation hostage."
Jeffries announced Tuesday that House Democrats would start the process of to force a clean debt-limit increase bill to the floor through a discharge petition. That allows a majority of 218 House members to bypass leadership and send a bill out of committee, straight to the floor. It receives legislative priority and must be voted on, but not after many legislative days of so-called “ripening” pass. As an actual tool to resolve the crisis before June 1, it won’t work. There simply isn’t the three or so months it will take to accomplish. As a release valve for panicky Republicans who don’t want to go down with the McCarthy/Freedom Caucus ship of default, it could be useful.
Likewise, Schumer has started the process of moving a debt ceiling bill through the Senate. He filed two options: a bill to suspend the debt limit through 2024, and another for the McCarthy/Freedom caucus bill the House passed last week. This was just the preliminary procedural motions to carve out floor space to deal with the issue, with no decision on the amendment process—or anything else.
The debt ceiling is the congressionally imposed limit on how much the government can borrow to continue to pay already obligated debts—money Congress has already appropriated. Those debts include things like paying for people in the military, Social Security and other federal pensions, and payments on foreign debt. The federal government needs to borrow money to pay its bills when its ongoing operations can’t be funded by tax and other federal revenues alone.
If the debt ceiling is breached, the consequences will be dire for millions of Americans. Secretary Yellen made that clear in her letter to McCarthy. Default would cause “severe hardship to American families, harm our global leadership position, and raise questions about our ability to defend our national security interests.”
It would immediately kill jobs, not just for federal workers but for people like janitors and nurses at rural and community hospitals that rely on federal payments. Social Security benefits, veterans’ pensions, and salaries for the troops could be cut off.
Even coming close to default is dangerous, Yellen stressed. “We have learned from past debt limit impasses that waiting until the last minute to suspend or increase the debt limit can cause serious harm to business and consumer confidence, raise short-term borrowing costs for taxpayers, and negatively impact the credit rating of the United States," Yellen said in the letter.
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The past week seems to have packed in a month’s worth of news. Markos and Kerry tackle it all, from Joe Biden’s big announcement to Tucker Carlson’s early retirement from Fox News.