The Debt Ceiling Abyss Is at Hand

It looks like the debt ceiling impass will go down to the wire. Will Biden invoke the 14th Amendment? One day he says he won’t, the next day he says he’s thinking about it.

Matt Egan at CNN reports that the Wall Street people aren’t worried about default.

Debt ceiling-inspired selloffs have been almost nonexistent. The Nasdaq is still up by a staggering 22% on the year. And CNN’s Fear and Greed Index of market sentiment is nearing “extreme greed” mode.

Perhaps this indifference is because investors have seen this drama before. They know how it ends: with politicians waiting until the last minute before giving in and finally raising the debt ceiling before disaster strikes.

Maybe it’s going to take a stock market plunge to get the tycoons up in arms about it, Egan speculates. Let’s hope it doesn’t come to that.

To complicate matters, Trump has been urging House Republicans to not give an inch. Obviously he wants to destroy the economy so that he can blame Joe Biden and be POTUS again. Any Republican who allows the debt ceiling to rise is going to get slimed by the MAGAs. Although given the results of recent elections, that might not be a bad thing for a candidate.

Ezra Klein, whose opinion I respect, says the 14th Amendment plan won’t work. But Robert Reich, writing in The Guardian, says just go for it already. He recalls that in 1985 Congress agreed to raise the debt ceiling only after the Reagan Administration had started to raid the Social Security fund to pay debts. (I did not know this.) And then Reich points out that the crazies running the House aren’t bending at all.

Which is why it’s critical for Biden to continue paying the government’s bills and for the treasury secretary, Janet Yellen, to continue using every bookkeeping scheme imaginable to find the means to pay those bills.

They must never declare an “X-date”, and never default.

If Kevin McCarthy and his band of radicals don’t like this, let them take the Biden administration to court.

Let House Republicans argue in the courts that the 1917 act establishing the debt ceiling has precedence over section 4 of the 14th amendment, which requires that the “the validity of the public debt …. shall not be questioned.”

I’m with Reich on this one. But if the 14th is invoked Janet Yellen had better be prepared to borrow money asap before Clarence Thomas and the boys of SCOTUS try to stop her.

15 thoughts on “The Debt Ceiling Abyss Is at Hand

  1. Use the 14th Amendment.

    Raise the damned debt ceiling.

    Just do it!

    Yes, I believe there are Republicans who'd go along with the D's.  But not today.  Maybe in a different time.

    But right now, the RepubliKKKLANs are terrified of their base.  And justifiably so.

    They're probably more terrified of their base than we liberals are terrified by their base!

    If some loon can bring a baseball bat to Democrat Gerry Connolly's  neighborhood office, imagine what a GQP Congressritter thinks a MAGA loon would bring to the office of someone that loon viewed as a traitor?

    These "don't tread on me" snakes are scared shite-less of their own tails.



  2. I really identify as a pragmatic more than a liberal, but other folks in my world think otherwise.  Especially the ones that have never made anything work in their lives.  Now we have a wing of the republican party that is anti-pragmatic.  They use the power to destroy things to have power.  Extortion is OK?  Prevarication is OK?  The end justifies the means?  Are the sold out (whoring), well, not unless you think the gospel of greed is inspired.    

    Biden may be old, but he is one seasoned politician.  One thing we know for sure, If god exists, he/she has an Irish bias.  This will have a happy ending.  

  3. One thing we know for sure, If god exists, he/she has an Irish bias.  This will have a happy ending.  

    I hope you are right. 

  4. I've been watching the dynamics of power in the House. I think it's unprecedented. A sizable faction believes they have the advantage in a scenario of complete chaos and catastrophe. Another powerful faction is protecting the traditional  GOP donor class –  Big Pharma, the fat cats who benefit most from the Trump (and Bush) Tax Cuts, the military-industrial complex, and Big Oil. Often, in politics, you can see who is pulling the strings – usually, it's big money. 

    I don't see how these money groups won't all suffer in an economic depression, especially a global crunch. OR has ALEC or some group more powerful and secret decided that the demographic trend (old conservative voters being replaced by young liberal voters) makes democracy an unworkable form of government if their power and profits are to be preserved? If big business is on the same page as the loonies with their conspiracy theories and they are dedicated to bringing the US government down, the path out of this crisis is very narrow. 

    The Democrats in the House are united in not defaulting on the debt. We need to pick up four GOP votes in the House to raise the debt ceiling. I agree with GULAG – for a Republican to break ranks on the debt ceiling, he/she will put their life on the line. But we've seen some of them do it. If the economy starts to tank in their home states and districts, there will be huge pressure to knock off the BS. The greater the pain, the greater the pressure. It will happen – the question is how much pain before the local pressure causes four or more to break ranks with the lunatics. 

    Ending the debt crisis would be a two-step process. First, remove McCarthy – the Freedom Caucus has made that easy. Any member of the house can call for a vote, as I understand it. If all the Democrats with four or more Republicans vote for an alternate, McCarty is out. If the alternate has agreed to bring the debt ceiling up for a straight vote with no concessions, it's a done deal.

    The price is the damage to the US credit reputation. And the recovery from the recession/depression or whatever the temporary default has created. I'm not sure anyone knows how bad it could get. Semi-sane Republicans were promised the debt-ceiling hostage gambit would work with no down side or economic consequences. When SOME of these congress critters get word back from local fat cats that the rich are feeling the pain, the House members are going to reconsider. 

    At the same time this is evolving, Democrats will be getting the same message –  that the local Democrats who make up the local donor class are feeling the pain. Democrats will be under pressure to settle with the GOP and end this. The hope and expectation from the GOP is that Dems will cave first. The problem(s) are that nothing Biden will agree to will satisfy the Freedom Caucus. I think the FC will vote against anything McCarthy will negotiate. That's (possibly) nineteen votes that the Democrats will have to provide to offset the anarchists. I'm not at all sure the Democrats in the Senate will allow the evisceration of all social programs and I'm hopeful Biden won't cave. So I think the GOP has a much steeper hill to force a dozen or more Democrats to defect, compared to only four Republicans.

    I think we're going over the cliff.

    Yeah, there's the 14th. I'm not sure if anyone has "standing" to sue Biden and the administration if they just do it. Where the USSC would come down and their reasoning is anything but clear. Biden would be usurping power that the Constitution clearly handed to Congress. BUT, Congress is failing to perform the obligations they have under that same Constitution.  The USSC may not survive a collapse of the US, mixed with an armed revolution. So do they recognize and opt for their own survival by striking down the law that created the debt ceiling?  I have no idea. 

    My gut feeling is that this is the "Battle of the Bulge" for the MAGA kooks and what they've turned the GOP into. (The Battle of the Bulge was the last German offensive in WWII, a desperate attempt to gain the initiative in Europe after D-Day and massive advances toward Berlin.) The GOP has lost ground in 2018, 2020, and 2024. They're doubling down on policies hostile to women and minority groups that have motivated young voters, a trend that's not going away. The GOP is married to Trump and Trump can't win in the general election. I think the radicals in Congress sense that they must grab power before Trump is behind bars or in self-exile or they will lose the war. I think they perceive – they win now or they lose forever.

  5. What ever happened to Paul Krugman's Trillion Dollar Coin idea? 

    Apparently, the US Treasury is empowered to print whatever Coins they deem necessary; Krugman's idea was to print a few Platinum coins, declare that they are worth $1T each, and essentially use those to cover any deficit (I missed a step in there, something about the Fed).

    IIRC, he first proposed it – perhaps facetiously – when the GOP pulled the same stunt on Obama (or maybe it was when they pulled the *same* same stunt on Clinton?).  Financial press didn't take it seriously, but I don't recall ever reading anything which made a good argument for why it couldn't be done.  Sure, it's unorthodox, but IMO that makes it *really* appropriate now.

    I'm tired of GOP shenanigans like this; negotiating with them *again* about this will just ensure that it happens again next year, and *every* time the GOP controls the House or Senate while there's a Democrat in the White House.  Letting them get away with it *again* reinforces the Big Lie that Democrats created the our current Debt bubble.

    Nobody cared much about the Federal Deficit until that Ferengi Zillionaire ran for President in 1992, objecting to the increase in Federal Debt caused by Reagan's Tax Cuts for the Rich (and ballooning Military spending).  Ever since then, the GOP has been blaming it all on Democrats, and the Democrats have let them get away with it ***by taking the issue more seriously than Republicans do***!


    It's time for the Democratic Party to actually fight back.


    To make the Trillion Dollar Coin trick even better, they could be stamped with Ronald Reagan's face, pretending it's a sign of respect…

  6. Doug,

    I don't think you hit a single false note in your earlier dirge. 

    I'd like to add, that imo, all of the members of the FreeDUMB KKKauKKKus, and the newest dim/nit/half/fuck-wits like Marge Traitor Groin and Moron Bobo-bert, are actually sexually excited by defaulting.

    In the days after the default, the entire GQP KKKaos KKKauKKKus will have multiple orgasms* if they force the country into that disaster.

    *And if that happens, the poor people who have to clean the House may look back fondly on the shit and other effluvia they had to clean-up after the January 6th coup!



  7. While the free-dumb caucus may not realize just how serious the consequences could be if the US defaults on its debt, I'm sure McCarthy knows.  McCarthy is less of a true believer, as he is a craven political toady, so desperate to remain speaker he’ll agree to just about anything. I can imagine if the caucus didn’t have a gun to his head, with MTG’s finger on the trigger, he’d be more agreeable to work out a compromise with Biden.  Problem is, he knows that gun will go off if he accepts any reasonable compromise (not that Biden should be considering one anyway, and not that the republicans would go for it) or even appears to, lest they cut him off at the knees and stand up someone even crazier.  That they’re still talking means the politics of it from McCarthy’s perspective has come up, e.g. Joe, you know I can’t cave on anything, and if I even appear to allow anything that smells like victory, I’m done. 

    The way out from under all that for McCarthy and probably many other House republicans who don't want to see the US default on its debt, but don't have the courage to join democrats in raising the debt ceiling, is for Biden to invoke the 14th Amendment and ignore the debt ceiling.  They're probably hoping he does but of course can't say it.  Its the only way they can exit this game with all their BS intact.  Sure, they’ll sue, but even if the court issues an injunction, they can cover these debts before being stopped.  Also, in court, republicans are going to have to clearly stand on the side of defaulting and destroying the economy, over their own extremist politics, using  rule that isn’t even covered in the constitution let alone one that makes zero sense.

    Biden should invoke the 14th amendment now and let the chips fall where they may.  He can say he he tried to negotiate with them, even when he shouldn’t have.  That would be better than trying to negotiate out of it, because once the negotiation starts, once they smell blood, the only end will be the complete destruction of the Biden agenda.

  8. OT but interesting.

    “We represent Donald J. Trump, the 45th President of the United States, in the investigation currently being conducted by the Special Counsel’s Office,” it read. “Unlike President Biden, his son Hunter, and the Biden family, President Trump is being treated unfairly. No President of the United States has ever, in the history of our country, been baselessly investigated in such an outrageous and unlawful fashion. We request a meeting at your earliest convenience to discuss the ongoing injustice that is being perpetrated by your Special Counsel and his prosecutors. Thank you for your attention to this matter.”

    The kicker is that Trump CC'd "Members of Congress."

    I agree with Steve Benen that action by Congress to call off the prosecution of Trump is impossible, a word I use with great restraint in these days of anarchy. But Trump's legal strategy seems to be the intervention of the legislative branch to call off the DOJ (executive branch) and the judicial branch.

    Some have reported that 'negotiations' on the debt ceiling are literally going backwards with McCarthy making MORE demands in each meeting, not concessions. Will a new demand this week be immunity for the former guy? This would be a bad joke but let's see if it happens. The letter does not seem to be a serious appeal to Garland, so who is the letter actually for and what's the goal?

    If the MAGAs in the House see the incarceration of Trump as the end of the road for the movement, will they make this demand openly? 

  9. I don’t like the 14th amendment idea. First the wing-nut supremes will almost certainly block it (it would fly if the GQP was in the WH, but we know the deal here). Second all it has done is give the GQP another option to lay all this on Biden. I say he should tell them to pound sand and let the default happen. When the olds stop getting their SSI (I got mine today!) shit will change quickly. The magats think this will crash the economy and get Stump elected. They are right about crashing the economy but it’s not going to help Stump. In fact this might finally put and end to the magat wing of the GOP. The mainstream media will be forced to tell the truth about who is to blame, only FAUX will be blaming Biden, it won’t work. Tell them to fuck off Joe!
    O.T today marks the one year anniversary of the horrible school shooting in Uvalde Texas. One year later and of the 331 cops who refused to act for 77 minutes not one of them has been charged, Unbelievable. Here is the only good thing that ever came out of Texas! Billy Joe Shaver

    • How many divisions do the Wingnut Supremes have?

      What could they do if the President, the Congress, and indeed the rest of us Americans, simply defied them?

  10. Politicians forgot an essential political term, and without it they seem to have lost their ability to govern.  How long has is been since a politician uttered the word poppycock much less the duo pure poppycock.  How do we achieve the appropriate level of government spending and borrowing.  We eliminate all expenditures that are pure poppycock, e.g. house committees run amuck.  This is but an example and both parties fund programs that rate the label of pure poppycock. Many more rate only the ranking of poppycock.  

    The term poppycock is not, as some think reserved for use by the British.  From an old NYT article:

    So would Americans. The O.E.D. labels poppycock as originally United States slang, and Burchfield's Brigade has recently unearthed a use by Charles Farrar Browne, the humorist who went by the name of Artemus Ward, in 1865: ''You won't be able to find such another pack of poppycock gabblers as the present Congress of the United States,'' a statement that we might expect to hear today from a White House spokesman.

    Poppycock gabbler is MTG in five syllables.

    We are really out of time to start on that task though, but the house could start a true bipartisan committee on poppycock spending elimination.   In the meantime, they need to increase the debt ceiling until the committee issues its list of expenditures it has labeled as poppycock and pure poppycock. 

  11. Who stands to gain should the debt ceiling kerfuffle result in a worst case scenario?


    Brazil, Russia, India, China, South Africa.

    Those nations will become the economic powerhouses in the 21st century. 

    Even Russia. Once the USA is technically broke, and Europe is swirling down the economic toilet with us, all Russia needs to do is wait out the end of the military assistance and Putin can refill his coffers with a Rape of the Sabines style methodical turning of Ukraine into a wasteland.

    China will not believe their luck, India is poised, arguably, to become the economic powerhouse to compete with China, and South Africa has GOLD GOLD GOLD.

    That's a big deal. Kevin McCarthy's cries of spending cuts or no deal will be the American Empire's epitaph.

    Raising the debt ceiling simply means the country promises to continue paying interest on the debt monies THAT ARE ALREADY SPENT.

    Yeah, that's worth destroying the economy.



  12. The investor class remembers how well they made out in the rebound/recovery that began in 2009.  They are fine with some occasional crashi-ness, just another buying opportunity.  As Alfred E. Neuman used to say, "What – me worry?".


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