Republicans Plot Another Hostage Taking, Threatening the Full Faith And Credit Of The U.S., And The Economy

Huffington Post reports, Republicans Pledge To Oppose Paying Debts They Voted For:

Republicans in Congress say they will vote against legislation to increase the amount of money the federal government is allowed to borrow to cover the gap between revenue and spending ― even though they themselves are partly responsible for the deficit.

Reps. Kevin Hern (R-Okla.) and Jim Banks (R-Ind.) announced Monday in an open letter signed by more than 100 of their House colleagues that Republicans wouldn’t vote for a debt limit increase. [This is a violation of their Constitutional duty to honor the full faith and credit of the debt obligations of the U.S.]

And Republicans falsely suggested that Democrats are entirely responsible for the debt. “Because Democrats are responsible for the spending, they need to take responsibility for increasing the debt ceiling,” Hern and Banks wrote, echoing a similar letter from Senate Republicans.

Democrats are responsible for the spending, but so are Republicans, who have voted for new spending and GQP tax cuts that contributed to the government’s borrowing needs.

In 2017, for instance, Republicans passed a GQP tax cut ― without a single Democratic vote ― that the Congressional Budget Office estimated would add more than $1 trillion to budget deficits over a decade. (Some Republicans dubiously claimed the law would generate economic growth that would offset the lost revenue [i.e, the long discredited and disproved faith based supply-side ‘trickle down” economics.]

“Democrats and Republicans both share responsibility for our current accumulation of debt,” said Marc Goldwein, senior policy director at the Committee for a Responsible Federal Budget, which opposes budget deficits. “Both Democrats and Republicans, sometimes together, sometimes separately, have voted to increase the debt.”

In a statement earlier this month, Treasury Secretary Janet Yellen noted that the “vast majority of the debt subject to the debt limit was accrued prior” to President Joe Biden taking office. Yellen has said hitting the debt ceiling would cause “irreparable harm to the U.S. economy and the livelihoods of all Americans.” The government could wind up unable to pay bondholders or beneficiaries of programs like Social Security retirement insurance. [This is what Republicans are threatening to do.]

In their letters, Republicans have not said that the debt ceiling shouldn’t be raised from its current position of $22 trillion. And they’re not making any specific demands that spending cuts accompany a debt limit increase, like they did during the Obama administration in 2011. They’re just saying Democrats should [raise] the debt limit by themselves [while do-nothing Republicans violate their Constitutional duty to honor the full faith and credit of the debt obligations of the U.S., and sabotage U.S. credibility and the economy.]

“They have total control of the government, and the unilateral ability to raise the debt ceiling to accommodate their unilateral spending plans,” Monday’s letter said.

But Democrats have said they’ll leave the debt limit out of the $3.5 budget reconciliation they’re planning to pass this fall without any Republican support, meaning the two parties are essentially playing a game of chicken over a debt default.

The Congressional Budget Office has said the federal government will probably run out of cash sometime in October or November.

Politico adds, Dems dig in on debt as painful September looms:

Republicans raised the debt ceiling with minimal drama under Donald Trump. Now Democrats are prepared to make them publicly refuse to do the same for Joe Biden.

[Democrats’] move to pass a budget resolution without tackling the debt ceiling, completed last week, adds a perilous deadline to Democrats’ season full of lofty promises on infrastructure and social spending. It’s not only the majority party facing a fall challenge, however: Republicans will have to actually block a debt ceiling increase instead of just talking about it.

The borrowing fight is perhaps the most immediately consequential drama during a momentous fall for Biden and the Democratic agenda. In addition to raising the debt ceiling, Democrats must fund the government past Sept. 30, devise a likely multitrillion-dollar spending bill and put Biden’s infrastructure bill over the top in the House. Democrats will also make one last-gasp effort at passing voting rights legislation.

“The fall is complicated already. And the debt ceiling is going to make it even more so,” said Sen. Tim Kaine (D-Va.). Asked about his level of confidence in avoiding a default, he replied: “I’m not gonna use the word confident. I’m gonna use the word optimistic.”

Though Democrats could have excluded the GOP from discussions altogether, Speaker Nancy Pelosi and Senate Majority Leader Chuck Schumer want to test the credibility of debt protests from Republicans over the ambitious spending plans from Biden’s party. The smart money is still on Democrats tying a short-term debt ceiling lift to a stopgap funding bill in late September, challenging Republicans to vote to shut down the government and bring the nation to the cusp of default.

If that strategy falls through, Democrats could uncouple the debt ceiling from government funding and try a standalone vote closer to the default deadline, which is likely in October or November, according to aides. But that, too, might fall short with the GOP: Senate Minority Leader Mitch McConnell is leading the charge against Biden just as he did against former President Barack Obama, arguing that Democrats’ proposed spending plans are so large that Republicans can’t go along with increasing the debt limit.

Democrats are holding firm and betting the GOP will flinch before the U.S. defaults on its loans, a doomsday point expected to hit anytime between September and November. House Budget Chair John Yarmuth (D-Ky.) said simply: “As difficult as they can be, I can’t imagine there aren’t 10 Republicans who would vote not to default.”

Republicans retort that they are deadly serious, saying that the votes simply aren’t there to raise the debt ceiling and pass a spending bill together. [This is a violation of their Constitutional duty to honor the full faith and credit of the debt obligations of the U.S.] Sen. John Cornyn (R-Texas) said there’s no path to 60 upper-chamber votes for raising the debt limit “unless there’s reforms associated with it.”

There’s the ransom demand. You want a reform? Get rid of the federal debt ceiling so we don’t have these GQP hostage takings every time a Democrat is in the White House.

Democrats “had a way to solve the problem, and now they are creating one for themselves and for everybody else. Because they could have included it in their budget resolution and done it with 50 votes and the vice president,” Cornyn said. “Apparently they want the drama.”

Sen. Cornyn has always been a poor excuse for a senator and human being. What he is really saying is that Republicans do not want to go on the record voting to raise the federal debt ceiling to pay for their massive GQP tax cut for corporations and the wealthy, and two Covid-19 relief bills that were bipartisan, before Joe Biden became president. Cornyn is upset that Democrats are forcing Republicans to do their goddamn constitutional duty and honor the full faith and credit of the debt obligations of the U.S. – debts that Republicans incurred. Damn deadbeats.

While the nation has never defaulted, such a failure would diminish the country’s reputation [and credibility] as a borrower and stun the global economy. And Democrats could later revise their budget resolution and raise the debt ceiling without GOP support, something some in the party were pushing for earlier this summer.

Democrats aim to spend more than $6 trillion in total this year on coronavirus relief, infrastructure, social programs and climate change. Some of that money will be paid for with tax increases and greater IRS enforcement; a good portion is deficit spending that Democrats argue will ultimately be both popular and pay for itself.

Biden’s party plans to deliver most of its spending via budget reconciliation, the arcane process that allows the majority side to skirt a filibuster in the Senate. After Republicans used reconciliation to slash taxes and increase the deficit in 2017, Congress went on to raise the debt ceiling — with Democratic support.

Now it’s the GOP’s turn to return the favor, Democrats insist.

“We can’t negotiate over it. We shouldn’t negotiate over it. And Republicans are going to have to answer if they choose not to pay America’s bills,” said Sen. Chris Murphy (D-Conn.).

“We have to stop playing games with this. I mean, we need to set a precedent that this is expected of you as a member of Congress to pay America’s bills,” Murphy added. “I understand the Republican talking point. But their massive $4 trillion tax cut is absolutely driving the high deficits and debt numbers.”

[D]uring the Obama administration, a previous GQP debt ceiling hostage takings brought budget cuts (budget sequestration) and even a credit downgrade to the United States. (S&P downgrades U.S. credit rating (August 2011), Moody’s and Fitch followed suit. The “Grim Reaper of Democracy, Mitch McConnell, owns this). Democrats say they have learned from those fights not to even engage in negotiations with the GOP.

Striking a deal to increase military funding has often built enough Republican support for debt limit action in the past. While Biden is calling for a roughly 1.5 percent increase in defense spending, Republicans have already recruited Democrats this year to support boosting the recommended Pentagon budget from $715 billion to over $740 billion. [The military-industrial-congressional-media complex at work.]

“Whenever they’re talking about adding defense money, everything’s negotiable,” said Rep. Mike Rogers of Alabama, the top Republican on the House Armed Services Committee. “I would entertain it.”

While Democrats now say they will not barter with funding as a way to avert the debt cliff this year, their plan to tie debt limit action to the September government funding deadline will once again link the two pressure points. Because Congress is expected to agree only to a short-term patch next month that staves off a shutdown for a few more weeks or months, debt relief might only last for that short period of time.

Yarmuth said it is “entirely possible” Congress passes a short waiver of the debt limit this fall, along with a stopgap funding bill, merely moving the debt cliff into the winter.

Congress voted in late 2013 to waive the debt limit for three months, and then again for less than four months. Of course, that followed a 17-day full government shutdown — an episode few in Washington would like to relive eight years later.