July 31!
Roadblock after roadblock keeps getting in the way of Congress’s effort to waste $6 trillion.
First, the Senate Parliamentarian ruled that Senate Majority Leader Chuck Schumer couldn’t use multiple reconciliation bills in one year to bypass a Republican filibuster.
Then there were those skinflinty “moderate” Republicans who would only agree to spend $1 trillion (give or take a $100 billion or so) on infrastructure.
And now July 31 is approaching. That day marks the end of the 2019 Bipartisan Budget Act’s suspension of the federal debt ceiling. Which means in a month Democrats will have to increase the debt ceiling (yet again), suspend it (yet again), or eliminate it once and for all.
Democrats won’t like that debate—just as many Republicans will like it—because the need to raise the debt ceiling will bring even more attention to how much taxpayer money President Biden and his fellow Democrats want to spend. And yet it is part of Congress’s job.
According to the Congressional Research Service, “Congress has always restricted the federal debt.” That’s an important part of Congress’s “power of the purse.”
Years ago, raising the debt ceiling wasn’t that controversial. But, “Debates over federal fiscal policy have been especially animated in the past decade, in part because of the accumulation of federal debt in the wake of the 2007-2008 financial crisis and subsequent recession. Rising debt levels [currently $28 trillion-plus and counting] along with continued differences in views of fiscal policy, led to a series of contentious debt limit episodes in recent years,” writes the CRS in a different report.
And not just “more contentious” but more frequent. Congress has modified the debt ceiling 25 times between 1993 and 2019.
In the past Congress simply raised the debt ceiling. More recently it has switched to temporarily suspending it. Once that suspension ends—July 31, 2021, in this case—the current debt becomes the imposed limit.
Since the government will have no authority to borrow more money, the Treasury Department will have to “employ extraordinary measures to meet federal financial obligations”—unless and until Congress increases or suspends the debt ceiling.
Democrats will likely be able to do it, even if they have to use the budget reconciliation process. But that could take a while—and they don’t have much time, especially at the rate the federal government is currently blowing through money.
Democrats could try to work out a deal with Republicans, but many GOPers feel burned by Biden’s “gaffe”—defined as when someone in Washington tells the truth—about vetoing the infrastructure deal.
But at least Republicans can use the debt ceiling to make Democrats pay politically for their spending blowout. Though it will fall to American taxpayers to pay financially for it.