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- House Republicans refused to raise the debt ceiling unless Democrats agreed to cut spending.
- The threat of a default and ensuing economic crisis forced Democrats to the bargaining table.
- Many progressive and moderate Democrats want to repeal the debt ceiling to prevent more brinkmanship.
Many House Democrats voted to raise the debt ceiling, but a number of them want to get rid of it.
On Wednesday night, House Republicans and Democrats came together to avert a default on the US debt and sent a hard-fought compromise bill to the Senate. A debt ceiling breach could wreck the economic recovery from the pandemic, put 2.6 million Americans out of a job, take $20,000 from the typical American's retirement savings, and hike payments on everything from student loans to mortgages.
Republicans, who control the House, used the potential economic crisis as a bargaining chip to extract policy concessions from Democrats. Still just days away from a possible default that could start June 5, House Democrats don't want to let this brinkmanship happen again. For many, that means repealing the debt ceiling.
"For many, many, many years, people recognized that Republicans and Democrats worked together to pass a clean debt ceiling. But this hostage taking cannot continue," Rep. Pramila Jayapal, who chairs the Congressional Progressive Caucus, said after the vote.
"We should get rid of the debt ceiling," the Washington State congresswoman told Insider.
After Republicans refused to raise the debt ceiling without spending cuts, even just to buy Congress time to negotiate, the Republican Speaker of the House, Kevin McCarthy, and President Joe Biden made a deal that would suspend the debt limit while capping spending, increase work requirements to receive food stamps, force student loan payments to resume, and claw back funding for the IRS and state pandemic relief.
Put in place when the US entered World War I to check the power of the president over military spending, the debt ceiling has been raised 78 times, one way or another, since 1960. That has allowed Congress to keep borrowing money to fund the government when it routinely spends more than it brings in through revenue.
However, in the last few decades, Republicans have threatened not to raise the debt ceiling and let the US default on the debt unless Democrats agreed to their policy demands like cutting spending. To be fair, Democrats used these tactics to increase funding for various programs in 2006, but Republicans remain the only party to have held out long enough to induce government shutdowns and a downgrade of the US credit rating.
"We need to remember that the only two times we've had this kind of hostage taking crisis have been when Republicans have been in charge of the House with a Democrat president," Rep. Teresa Leger Fernández told Insider.
"We need to eliminate the possibility of taking hostages in the future," the New Mexico congresswoman went on. "We need to pass the bill to eliminate the debt ceiling limit."
"We cannot allow this to become regular operating procedure," Rep. Jamie Raskin of Maryland told Insider. "You can't stick up the government of the United States and shake it down for your legislative program that otherwise you couldn't pass just because you think you can plunge the whole country into economic crisis."
Raskin reiterated an argument that the 14th Amendment could be used to eliminate the debt ceiling. "Constitutionally, we never had the power to repudiate and dishonor the debts of the United States," the former constitutional law professor said. "It allows one party faction to threaten to repudiate and nullify the debts of the country," and Section 4 of the 14th Amendment was designed "precisely to prevent that kind of manipulation," like when the South wanted to repudiate the debts Lincoln accumulated in the Civil War.
"It's clear that the debt ceiling statute such as it is has outlived whatever utility it once had, and we gotta get rid of it at the first available opportunity," Raskin added.
"We should get rid of it," Rep. Shri Thanedar of California concurred. "United States and Denmark are the only two countries I believe have a debt ceiling," he said, noting Denmark's many safeguards that make a default nearly impossible and cheaper borrowing rates that make US debt easier to pay down.
The crisis has roused support for repeal
Though opposed to the bill's provisions that would fall on welfare recipients and other aspects of the deal, Jayapal said, "The one good thing about this is I think we have more support than ever probably to get rid of the debt ceiling and give the authority to the Treasury Secretary."
"There's a lot more support because clearly Republicans have shown that they cannot uphold their constitutional duty and just pass the debt ceiling to implement what Congress has already negotiated past and spent," she explained.
Jayapal was among 46 Democratic votes against the debt ceiling deal, though it passed handily with 315 votes out of the House's 435, including 165 from Democrats.
Rep. Dan Kildee, who voted for the bill and is a member of the bipartisan Problem Solvers Caucus, supported ending the debt ceiling.
"I would think we would have to be committed to regular order in the appropriations process, but I think this would help solve that," the Michigan congressman told Insider.
"What the Republicans have proven is that the utility of the debt ceiling is dangerous in the hands of irresponsible people and has very little otherwise utility," Kildee said. "The one time that it has utility is when it threatens the global economy."
Though not saying he'd repeal the debt ceiling, Rep. Jeff Jackson of North Carolina, who voted for the bill and is part of the more fiscally moderate New Democrat Coalition, said, "There will be a lengthy conversation about how we can make sure that we don't go through a process like this again, because it's deeply unhealthy."
from Business Insider https://ift.tt/Ieo9EbZ
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