January 31, 2023
House speaker Kevin McCarthy (R-CA) is having to grapple with the difference between the rhetoric that fires up the Republican base and the reality of governance. Since Nancy Pelosi (D-CA) became speaker in 2019, Republican lawmakers have been able to complain and demand without actually having to participate in legislation. Now, though, it is up to McCarthy to bring the party’s rhetoric into the reality of laws, and so far it’s not going particularly well.
McCarthy won the votes to become speaker by promising the far-right members of the Republican conference a number of things, including that he would not agree to raising the debt ceiling without demanding cuts in federal spending. It was a plan that sounded good to those interested in cutting the government: it would essentially hold the government hostage until they got what they wanted.
But this argument mixed together two separate things: the debt ceiling, which must be lifted to enable the government to pay for money already appropriated, and the budget, which is a plan for spending money in the future. Raising the debt ceiling is about protecting the country’s financial health, and refusing to lift it would throw the country—and possibly the world—into economic chaos. Negotiating over the budget is…normal.
McCarthy is continuing to try to tumble these two things together, demanding cuts to federal spending before he will agree to raise the debt ceiling.
This is awkward for the Republicans for two reasons. First, about $7.8 trillion of the $31.4 trillion debt that now must be paid came from the Trump years, and much of it came from the 2017 Trump tax cuts on corporations and the wealthy. During the Trump years, Congress raised the debt ceiling three times.
The second reason the Republicans’ demands for cuts are awkward is that they will not actually say what cuts they want. Before the 2020 election, party leaders, including Florida senator Rick Scott, then chair of the National Republican Senatorial Committee in charge of getting Republicans elected to the Senate, called for cuts to Social Security and Medicare. Those take up a big portion of the annual budget: Social Security alone takes about 21%. Throughout January, Republicans have echoed calls to cut the programs, only to face a backlash.
So they have now backed off on demanding those cuts. On January 20, Trump, who in 2021 pumped up the idea of using the debt ceiling to get their way, warned Republicans not to cut “a single penny” from Social Security and Medicare. On Sunday, McCarthy said that such cuts were “off the table” (although he also insisted that the Republicans simply want to “strengthen” the programs, and Republican proposals that include that language call for raising the age for eligibility, so who knows?).
For their part, President Joe Biden and the Democrats have said that they will not negotiate over the debt ceiling. It is vital to pay the nation’s debts—debts already incurred, many of them under Trump—and the security of that debt must not be questioned.
But they have made it clear they are happy to negotiate the budget, which is, as I say, a normal part of doing business.
McCarthy, in contrast, is caught between the rhetoric of the party for the past several years and the reality of the debt issue. He has to deal with the fact that a few of the farthest right members say they won’t lift the debt ceiling under any circumstances. He also has to appease a number of far-right Republicans who say they will not agree to raising the debt ceiling without negotiating a plan for significant cuts to federal spending going forward. But here’s the kicker: even if the Democrats were willing to let them hold the government hostage to get their way—something the Democrats utterly reject—with Social Security and Medicare apparently off the table, the Republicans cannot agree on any places to cut.
On Wednesday, Biden and McCarthy will meet in person. Yesterday, National Economic Council Director Brian Deese and Office of Management Budget Director Shalanda Young sent a memo to the Republicans pointing out that protecting the security of the national debt has always been a bipartisan commitment. This is actually not true, but the debt fights of 1866 and 1879 are not widely known, and in any case, their next point accurately reflects the outcome of both of those fights: “[T]he United States must never default on its financial obligations,” they said. “Raising the debt ceiling is not a negotiation; it is an obligation of this country and its leaders to avoid economic chaos.”
Deese and Young insisted that McCarthy “commit to the bedrock principle that the United States will never default on its financial obligations.”
They then turned to the budget issue, asking when McCarthy and the House Republicans would release a “detailed, comprehensive” budget. Biden’s will come out on March 9, and normally the two sides would negotiate over the different proposals. But the Republicans won’t say what they’re planning to do.
Deese and Young pressed McCarthy, writing that it is essential for the Republicans to tell the American people their plans so they can see how the Republicans are planning to reduce the deficit, “whether through Social Security cuts; cuts to Medicare, Medicaid, and Affordable Care Act (ACA) health coverage; and/or cuts to research, education, and public safety—as well as how much their Budget will add to the deficit with tax cuts for the wealthiest Americans and large corporations,” which their first bill—to make cuts to the Internal Revenue Service—would have done.
McCarthy's empty response—on Twitter—made clear just what an impossible position he’s in, especially since he had to agree to a rules change in the House that would let a single member launch a challenge to his speakership. “Mr. President,” he wrote, “I received your staff’s memo. I’m not interested in political games. I’m coming to negotiate for the American people.”
Senate Republicans, who are in the minority in their chamber, have made it clear that this is McCarthy’s fight, and they are staying out of it.
At a Democratic National Committee fundraiser today, Biden mourned the loss of the mainstream Republicans of the past and lamented McCarthy’s willingness to cater to extremists for power. He called McCarthy “a decent man,” but noted that it was vital to know “what’s more important than having the job” and to stand firm on those issues.
“I don’t know what’s gone haywire here with this Republican Party,” he said. Looking forward to the 2024 election, he concluded, the Democrats need to be very clear about “what we stand for, what we did, and what we need to do more of, and what we’re unwilling to do under any circumstances.”
Last March. Mitt Romney offered this plan to shore up tax cuts for the wealthy:
"In comments to the Senate budget committee on Wednesday, the Republican senator from Utah said that the spiraling costs of retirement programs had to be tackled to bring national debt under control. Romney raised the politically controversial idea of cutting benefits, but only for younger generations before they reach retirement age.
“ 'For younger people coming along, we got to be able to find a way to balance these programs or we’re gonna find ourselves in a heap of trouble,' he said. He added that he was not in favour of raising taxes as a way of balancing the books, but was open to adjusting “long-term benefits not for current retirees”.
Tax cuts for and bailouts for the wealthy, austerity for you. Should be their campaign slogan.
Is Social Security on or off the budget? Why do you call it an expense if it is funded by a dedicated tax... and remains pre-funded even today by some $2 trillion? Until just a couple of years ago, it was a net revenue source for the Treasury. I protest the characterisation of Social Security as an expense, or FICA as a tax. The payroll tax is a social insurance premium that buys a life-contingent pension with a spousal benefit. To call it an expense is to hand a weapon unnecessarily to Congressional allies of Wall Street, which is eager to get its hands on the payroll tax.