There's Nothing "Conservative" About Reneging On the Debt
Plus: The latest lies of George Santos, or whoever he is
House Republicans, whose savvy and gravitas have been on vivid display these last few weeks, now have a Grand Strategy for refusing to raise the debt limit and shutting down the federal government.
“Brinksmanship” seems like a euphemism for this fiscal game of chicken.
A hypothetical proposal that protects Social Security, Medicare, veterans benefits and the military would still leave out huge swaths of critical federal expenditures on things such as Medicaid, food safety inspections, border control and air traffic control, to name just a handful of thousands of programs. Democrats are also likely to accuse Republicans of prioritizing payments to U.S. bondholders — which include Chinese banks — over American citizens.
“Any plan to pay bondholders but not fund school lunches or the FAA or food safety or XYZ is just target practice for us,” a senior Democratic aide said…
In other words, the GOP’s Rube Goldberg plan is a non-starter. So what happens when the newly puissant Freedom Caucus takes the economy hostage, and the country teeters toward an actual default?
There’s no secret, no mystery here. Catherine Rampell lays out the consequences:
To be clear: Refusing to raise the debt limit, or even coming close to default, would be catastrophic.
To understand why, you need to know what the debt limit does and doesn’t do. It doesn’t authorize any new spending. But it does enable the federal government to pay off existing obligations that past Congresses had committed to through their previous tax and spending decisions.
The consequences of reneging on past bills could be dire…
Worst of all, not raising the debt limit — that is, defaulting on our debt, for the first time in U.S. history — might cause a global financial crisis.
And yet… The right has been nurturing its fantasies of debt-hostage taking for more than a decade, during which we have had more than enough time to research, document, and ponder the dire consequences of this sort of fiscal brinkmanship. AEI’s Michael Strain reminds us of how it worked out the last time the GOP toyed with default.
Even brushing up against a federal government default would be a major market event. On the day before Republicans finally agreed to lift the borrowing limit during the 2011 debt-ceiling standoff, the S&P 500 was down 6% from its high that year. Three days later, S&P downgraded the United States’ credit rating, sending stock prices tumbling further.
In the case of actual default, Strain describes what a global financial crisis would look like, and how the whole thing would end.
The Dow would plunge by thousands of points per day, and the credibility of the US – its trustworthiness as a country that pays its debts on time – would be substantially eroded. After a day or two of this chaos, a clean bill to increase the debt ceiling would pass both houses of Congress with overwhelming bipartisan support. Republicans would have accomplished nothing.
Despite that, Conservatism Inc. — and its many branches and tributaries in the right-wing media ecosystem — is beginning to wax enthusiastic over the hostage taking because burn-it-all down and fiscal conservatism.
Think of this as the Everything Everywhere All at Once Political Move of the Year, uniting all the strains of the pre-Trumpist, Trumpist, and post-Trumpist right: the dead-end demagoguery, performative outrage, and nihilistic radicalism that will fire up the base and launch a thousand small-dollar fund-raising appeals.
What it is not: anything remotely close to “conservatism.”
Indeed, it’s hard to imagine anything less conservative than defaulting on the debt you are obligated to pay and shutting down the government you are entrusted to run. The GOP is, after all, a party that claims to stand for financial rectitude, personal responsibility, and fealty to the Constitution.
After Tea Party Republicans threatened to force the U.S. to renege on its implicit and explicit contractual obligations in 2011, he wrote: “This behavior makes clear just how unhelpful labels like conservative and liberal have become lately.”
My primer on the moral authority of contracts has been Harvard Law Professor Charles Fried’s Contract as Promise, written in 1981 (four years before Fried went to Washington to become Ronald Reagan’s Solicitor General) as a defense of the “classical liberal” (what most Americans would call conservative) approach to contracts against an assault from the Left. Yet now a group of politicians who call themselves conservatives appear willing to cheerfully repudiate the contracts that the U.S. government has entered into — or, perhaps worse, cheerfully pretend that their actions aren’t putting the country at risk of default.
The new Jacobins have two classic American traits that have grown much more pronounced in recent decades: blanket distrust of institutions and an astonishing — and unwarranted — confidence in the self. They are apocalyptic pessimists about public life and childlike optimists swaddled in self-esteem when it comes to their own powers.
It’s worth remembering that the vote over the debt limit is a self-inflicted, artificial crisis. It is like scheduling a therapeutic game of Russian Roulette with hostages.
This is not what democracy looks like, and it is not rational governance.
Which is, apparently, why we keep doing it.
Exit take via Rampell:
Now, should Democrats have dealt with the debt limit while they still controlled both chambers of Congress? Yes. Absolutely. If we breach the debt ceiling in the coming months, their failure to do so could turn out to be the biggest tactical blunder of the Biden era.
Even if Democrats erred in not neutralizing this bomb when they had the chance, though, blame for any subsequent carnage should be on the maniacs lighting the fuse.
The Talented Mr. Santos
Besides its value as pure entertainment, the saga of George Santos (sic) is testing the GOP’s apparently endless capacity for tolerating lies, sleaze, and embarrassment.
The story (which is certain to get worse) so far:
The resume was a stew of bullshit and a roadmap of lies. “George Santos’s Secret Résumé: A Wall Street Star With a 3.9 G.P.A.”
The knees. Both knees. “In 2020 interview, Santos claimed to have two knee replacements.”
It’s like peeling an onion of deceit and corruption. “The Mysterious, Unregistered Fund That Raised Big Money for Santos.”
And there are Russians. Of course. “New details link George Santos to cousin of sanctioned Russian oligarch.”
I had some thoughts:
1. The McCarthy-Jordan Plan to Weaponize the House
If you want to know how twisted things already are under Kevin McCarthy’s days-long tenure as speaker of the House, just look at what’s on tap for the new “Select Subcommittee on the Weaponization of the Federal Government.”
In one of his first acts as speaker, McCarthy called a vote to create a new panel with sprawling authority to investigate how conservatives are mistreated, and every Republican voted in favor. It will have subpoena power and the ability to obtain classified information and review ongoing criminal probes, including those related to January 6th.
And whom has McCarthy tapped to lead this partisan initiative? Jim Jordan, the hyperpartisan Ohio congressman who also chairs the Judiciary Committee, of which this new panel is a subcommittee.
Jordan, you will recall, played a major role in Donald Trump’s efforts to overturn the 2020 election, both as a mainstay on Fox News pushing false claims about election fraud and as one of Trump’s top enablers in Congress. Not that this was anything new for him. For years, Jordan used his position on the Judiciary Committee to push Trump’s conspiracy theories. And although he refused to testify to the House January 6th Committee, describing it as a “partisan witch hunt,” the committee obtained a solid tick-tock of his participation in Trump’s most serious schemes.
2. Jim Jordan Overreaches in Attacking DOJ Over the Biden Classified Docs
Bottom line: Jordan’s allegation of impropriety has the familiar ring of political circus-mastering at the expense of protecting election integrity. It is up to citizens committed to an authentic constitutional government to call out the partisan overreach by Jordan and his colleagues, and allow the DOJ process to run its full course without fear or favor.
3. What I Learned from My Mom
Anyone who takes an honest look at our current political predicament must be taken aback by the depth of the dysfunction and the immensity of the challenge. But it is not hopeless as long as we can find reasons for hope. We all have a role to play in that process, whether it consists of exposing injustices, sewing tote bags for older people, or handing out ballots at the neighborhood polling place.
My mom was not political but she embodied the essence of good politics: Be kind. Be decent. Try to make the world a better place. You just might succeed, as she did.