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Debt Ceiling

Did The Debt Ceiling Deal Really Save The US From Bankruptcy?

June 20, 2023 Radhika Desai and Michael Roberts, Geopolitical Economy. , , , ,
So as far as the debt ceiling is concerned, there has been a pattern which has become a classic of sorts, with just days to go before the day that the Treasury Secretary Janet Yellen said the US would run out of cash to meet its obligations, President Biden and House Majority Leader Kevin McCarthy reached a bipartisan deal which is going to permit the government to keep borrowing in return for certain cuts in spending, social spending in particular, that the Republicans insisted on. The catastrophic disaster predicted by Treasury Secretary Janet Yellen in the weeks leading up to the negotiations and the deadline was again narrowly averted.

WSJ Celebrates Making It Harder For Poor People To Access Food

June 10, 2023 Conor Smith, Fairness and Accuracy in Reporting. , , ,
After holding the economy hostage for months, some Republicans are going through a bit of a depressive slump. “We got rolled,” is how one Republican congressmember (Roll Call, 6/6/23) described the outcome of the debt ceiling negotiations. “It was a bad deal.” But don’t cry too much, guys! The Wall Street Journal is here to cheer you up, and remind you that, though you didn’t get all the austerity you wanted, you did get to hurt the poor a bit. Maybe not as much as you wanted, but life’s not always fair, is it? As the Journal’s editorial board (5/30/23) recently wrote: “One reason the deal is worth passing: The provisions on work and welfare are incremental progress the GOP can build on.”

Debt Ceiling Hypocrisy: US Boosts Military Budget, Restricts Food Stamps

June 3, 2023 Ben Norton, Geopolitical Economy. , , , ,
The US government reached its debt limit of $31.4 trillion in early 2023. This unleashed a deluge of debate as to whether or not the Treasury was going to default, and how a deeply divided Congress could come to an agreement to raise the debt ceiling. The constant chatter in the mainstream corporate media overlooked the real controversy, however. The reality is that practically no one in Washington truly cares about the US national debt. In fact, in a bipartisan deal negotiated in late May to raise the debt ceiling, Democratic President Joe Biden and Republican Speaker of the House of Representatives Kevin McCarthy agreed not to cut but rather to increase the already massive military budget from roughly $800 billion to $886 billion.

For Media, Giving In To Debt Limit Blackmail Was Bipartisanship Triumph

June 3, 2023 Julie Hollar and Jim Naureckas, Fairness And Accuracy In Reporting. , , ,
When Congress passed the debt ceiling deal hammered out by President Joe Biden and House Majority Leader Kevin McCarthy, centrist media celebrated. If we had anything like a responsible White House press corps, we never would have gotten to this point. Treating the Republican gambit—demanding deeply unpopular policy measures in exchange for allowing the government to pay off debts Congress had already authorized—as anything other than economic hostage-taking gave it the legitimacy the party needed to stick with it without fear of massive political blowback (CounterSpin, 5/5/23). Instead, the press corps we have gave three cheers for bipartisanship.

Debt Deal Gives Fossil Fuel Lobby A Legal Shield

June 1, 2023 Rebecca Burns, Julia Rock and Andrew Perez, The Lever. , , , ,
The House of Representatives voted 314 - 117 last night to approve a debt deal that includes provisions expediting construction of a controversial fossil fuel pipeline — and attempting to block courts from hearing challenges to its legality. The language nestled into the agreement reached by the Biden administration and congressional Republicans last weekend came amid a flood of campaign cash from executives at NextEra Energy, one of the companies spearheading the pipeline, to Sen. Kyrsten Sinema (Ind.-Ariz.) and two other Democratic senators whose votes could be needed to pass the agreement.

Biden-McCarthy Deal: Neoliberal Fiscal Policy Continues

May 31, 2023 Jack Rasmus, LA Progressive. , , , , ,
Over the weekend, US House of Representatives speaker McCarthy and president Biden announced a tentative agreement on raising the debt ceiling. The deal—almost certain to pass Congress later this week—represents a typical Neoliberal fiscal policy deal. Ever since neoliberal capitalism policies were introduced under president Carter in the late 1970s, and subsequently expanded dramatically under Reagan, Neoliberal fiscal policy has been characterized by accelerating Pentagon and war spending; simultaneous cutting of business-investor taxes; acceptance of consequent escalating budget deficits—and in turn US national debt levels; and the use deficit/debt to cap and reduce social program spending.

Climate Activists Decry Pipeline ‘Deal With The Devil’

May 30, 2023 Brett Wilkins, Commondreams. , , ,
As progressives excoriated President Joe Biden's debt ceiling deal with Republican lawmakers over "polluter giveaways" including the Mountain Valley Pipeline, activists rallied outside Sen. Chuck Schumer's Brooklyn home on Tuesday evening with a message for the majority leader: "Stop the dirty pipeline deal, or we shut down your block." The protesters—led by Climate Defiance and backed by Food & Water Watch, Climate Defenders, Climate Families NYC, New York Communities for Change (NYCC), and others—chanted messages including "Schumer, stop the dirty deal" as they marched in the Park Slope neighborhood where he lives.

Debt Ceiling Agreement Improved, But Harmful Provisions Remain

May 29, 2023 Sharon Parrott, Center on Budget and Policy Priorities. , , ,
While the debt ceiling agreement announced last night is a significant improvement over the radical House bill, it is not the deal the country deserves. There are a number of troubling elements, including the provision that will put at risk food assistance for very low-income older adults. This policy will increase hunger and poverty among that group, runs contrary to our nation’s values, and should be rejected. The nation must pay its bills — but that shouldn’t mean enacting legislation that leaves people who already struggle to afford the basics worse off. We should never have been in this situation. We are here only because House Republicans twisted the rules of democracy.

Biden’s Debt Ceiling Betrayal Is A Democratic Party Tradition

May 26, 2023 Margaret Kimberley, Black Agenda Report. , , ,
When Joe Biden was first elected president his propagandists and their friends in corporate media told us that he was “the most progressive president since FDR” and that he would “cut child poverty in half.” Yet the temporary covid relief programs have all gone, from the Child Tax Credit, to emergency SNAP nutrition benefits, to automatic medicaid enrollment, and all with little fightback from the democrats. Now Biden is continuing the democratic presidents’ tradition of using sleight of hand to sell out the millions of people who have already lost what little help they had. The republican bogeymen and women have returned just when Biden needed them to make the case for his plan to further eviscerate the social safety net and continue the race to the bottom which results in precarity for the people.

The Left Case For The Trillion Dollar Coin

May 21, 2023 Maurice BP-Weeks, In These Times. , , ,
Kevin McCarthy won the gavel for Speaker of the House through a desperate and power-hungry agreement to manufacture the debt ceiling crisis. Rep. Ralph Norman (R-S.C.) told reporters that in order to earn the vote of the Freedom Caucus, it was ​“non-negotiable” that McCarthy promise he would ​“shut down the government rather than raise the debt ceiling.” Now they’re holding McCarthy to his word. In a recent article for In These Times, Max Sawicky laid out a compelling case for why the Biden administration needs to hold firm against the GOP. The programs Republicans are attempting to cut are popular, and it’s important to protect them as worthwhile in their own right.

Government Employees Union Sues Over ‘Unconstitutional’ Debt Limit Law

May 12, 2023 Zach Schonfeld, The Hill. , , ,
The National Association of Government Employees (NAGE) filed a lawsuit to block enforcement of a law that sets the nation’s debt limit, arguing it is unconstitutional as a political divide over raising the borrowing cap comes to a head. The lawsuit contends that, if the debt limit is reached, President Biden and Treasury Secretary Janet Yellen would be forced to decide which payments to prioritize, violating the separation of powers by taking over Congress’s spending authority. “The Debt Limit Statute is unconstitutional because it puts the President in a quandary to exercise discretion to continue borrowing to pay for the programs which Congress has heretofore duly authorized.

The Debt Ceiling Debate Is A Massive Deception Against The Public

May 11, 2023 Richard D. Wolff, Popular Resistance. , , , ,
Future historians will likely look back at the debt ceiling rituals being reenacted these days with a frustrated shaking of their heads. That otherwise reasonable people would be so readily deceived raises the question that will provoke those historians: How could this happen? The U.S. Congress has imposed successive ceilings on the national debt, each one higher than the last. Ceilings were intended to limit the amount of federal borrowing. But the same U.S. Congress so managed its taxing and spending that it created ever more excesses of spending over tax revenues (deficits). Those excesses required borrowing to cover them. The borrowings accumulated to hit successive ceilings.

Abolish The Debt Ceiling Before It Commits Austerity Again

September 30, 2021 Josh Bivens, Working Economics Blog. , , ,
The U.S. Treasury draws on banking accounts at the Federal Reserve to fund federal governmental activities—remitting paychecks to federal government employees, sending Social Security checks, reimbursing doctors for treating Medicare-covered patients, paying defense contractors and interest to bondholders, and so on. These accounts are fed on an ongoing basis by both tax revenues and the proceeds from selling bonds (debt). But, because the United States has a statutorily imposed limit of how much outstanding debt is allowed, once this limit is reached on issuing new debt, Treasury can no longer sell bonds and deposit these proceeds, and hence accounts at the Federal Reserve will dwindle as they are now only fed by ongoing taxes, which are insufficient to cover all spending.
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