False Crisis Averted
This past weekend concluded the current round of Kabuki theater known as the debt ceiling negotiations, where Biden signed the bipartisan compromise on Saturday. The bill received bipartisan support from both Democrats and Republicans: In the House the vote in favor was 314 to 117 and in the Senate, 63 to 36, with 46 Democrats and 17 Republicans voting in favor. Notably absent in their support for the bill were Progressive stalwarts like Bernie Sanders, other left-wing senators, and much of the progressive caucus in the House. Passage of the bill is currently being touted as a last-minute bit of expert high stakes maneuvering to avoid an economic meltdown, but it's important to understand this entire process was far more political theater than masterful negotiation.
The Biden administration and the Democrat at-large’s, obsession with bipartisan negotiation has led them, either willingly or not, to undermine many of the major legislative victories Democrats achieved earlier in his administration. Some lowlights of this negotiated bill include failing to repeal the Trump tax cuts, restructuring food stamp availability, and increasing work requirements for those on public assistance. In addition, Republicans extracted a multi-year freeze on discretionary federal spending across the board, except, of course, in “defense spending”, where despite Republican histrionics over the “woke waste” in the military, they were unable to find a single dollar to cut, and in fact, increased the defense budget by 3%! Taken together this leaves the rest of the government receiving an effective spending cut, especially considering the still elevated levels of inflation sapping the buying power of every dollar.
In a healthy economy, this would be bad enough, but this comes at a time of rising precarity among a large portion of the populace. As mentioned above, military spending escaped the negotiations unscathed, whereas in contrast, material progressive policies like funding the IRS and bold climate action were left on the cutting room floor. An especially galling example involves the last-minute addition of “baby-killer” Joe Manchin’s Mountain Valley Pipeline, which includes changes to the permitting process of industrial development, and hampers investment in climate crisis mitigating technology, like wind and solar. Manchin had been previously unable to extract this pound of flesh from the generally servile democratic caucus due to widespread protest from Progressive Democrats and general unpopularity of the bill. Critics have pointed out the permitting changes included in this deal will likely undermine investment and adoption of renewable energy funded through Biden’s IRA, one of the flagship accomplishments of his administration.
All of this in a deal Democratic leadership is touting as overall a win because Republicans didn’t get everything they wanted. Yes, the American people lost out while the rich remained untouched, unaffected, and unbothered, but as Joe Biden said this deal is “what the American people needed.” Here’s the truth, though, none of this needed to happen. Back in 2021, the last time the debt ceiling was raised, the Democrats controlled both houses of Congress and the presidency. In that moment, the party could have easily unilaterally removed the debt ceiling fight forever from the negotiating table. This was not rocket science, as it was widely predicted that failure to do so would create the very crisis we faced in 2023. Walking into an obvious political trap one failed to diffuse earlier is political malpractice, not deft maneuvering.
It gets even worse though, as in addition to Congressional foresight, a variety of other tools were available to the Executive branch to easily divert this crisis with minimal chicanery and concessions, from following the 14th Amendment, to minting a $1 trillion platinum coin. The reality is, however, the “debt ceiling crisis” was allowed to happen, because both political parties find this sort of theater beneficial. The only people that ever really lose in this situation are the American people, who don't want this Kabuki theater; they want a government that works, a government that doesn't brag when doing the bare minimum of paying its debts.
As we mentioned earlier this Spring, there was little chance of not raising the debt ceiling. The resulting economic catastrophe was not in the donor class’s interest. The only question was how much pain the American people were going to be made to suffer in the process. Unless the playing field is changed, this same hostage-taking situation of the economy will play out ad-infinitum with ever-increasing cuts and pain born by the American people. To get rid of this charade will take standing up against not just political forces but economic ones as well. We need to build a political and economic cudgel that can stand up to the moneyed interests that allow this charade to keep going as they extract more and more from the American people. We need a government that works for everyone, not just one that barely passes a budget. So, join us each Tuesday in growing solidarity, as we work to break this vicious cycle in 2025 that leaves Americans with only crumbs.
#DSOT
#UPM
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