An Abbreviated List of Things Responsible People Do: 1.) Steer Cruise Ships Around Icebergs. 2.) Raise the Debt Ceiling.
When it comes to the debt ceiling, Republicans expect everyone to act responsibly except for themselves.
For whatever reason, CNN let the most dangerous man in America vomit all over seventy minutes of their primetime programming last Wednesday night. You may think that’s overstatement: Not the part about the vomiting, but rather the “most dangerous man” bit, since Trump is a notoriously incompetent operator. What makes Trump dangerous, though, is not so much what he himself is capable of but what he essentially gives others permission to do. He is a nihilistic demagogue, a shameless, amoral man for whom might makes right. He has coaxed his followers—many once troubled by their consciences, most now certain of their righteousness—into believing and accepting the same. It is Trump’s ambition to stir and unleash these furies within American society and reap the rewards. We pay the price.
Trump’s appearance on CNN felt like a turning point, the moment the out-of-control clown we’d grown used to seeing ruin birthday party after birthday party turned into the Joker. He’s still an absolutely ridiculous figure but he’s owning it now, detonator in hand. Damage is at the top of his agenda. Which brings me to a topic Trump briefly babbled about that must be taken seriously now: The debt ceiling.
I have written about the debt ceiling before, so I’ll keep the explanation brief. The debt ceiling is a limit on the amount of money the federal government can borrow. Significantly, it is not a limit on the amount of money the federal government can spend. That distinction is important, because to meet all its spending obligations—i.e., Social Security, defense appropriations, interest on the debt, etc.—the government must borrow money. Before the government hits the limit on how much money it is allowed to borrow, it must raise the debt ceiling. If it doesn’t, the government won’t be able to borrow the money it needs to fulfill its spending obligations, resulting in default.
It is perfectly understandable for Americans to be upset about high levels of government spending and the federal debt. Many Americans believe Congress can rein in government spending by refusing to raise the debt ceiling. That belief is wrong. The government isn’t borrowing money first and spending it later. It instead a.) Decides what it wants to spend money on; b.) Uses credit to pay for those expenditures; and then later c.) Borrows money to pay off its creditors. (Yes, the government borrows money to pay off those it has borrowed money from.) Raising the debt ceiling must occasionally happen before step c.) to avoid default. The debt ceiling is not a mechanism that can be used to control spending; it is instead a permission slip Congress needs to sign before the U.S. Treasury can pay the government’s bills.
This is why economists often compare Congress raising the debt ceiling to you deciding to pay off your credit card bill: When you authorize yourself to dip into your cash reserves to pay off your credit card, you aren’t controlling your spending—you’ve already decided what you want to spend your money on and used your credit card to buy it—but paying off your debt. After all, you just can’t use your credit card to buy stuff and not expect to pay it off, as that would make your credit card company very angry, angry enough, in fact, to either make it very expensive for you to use your credit card or to cancel your account.
The United States has never defaulted on its loans before. No one knows with certainty what would happen if the U.S. did default, but most economists don’t want to find out, as most believe a default would send the U.S. economy into a tailspin resulting in a global economic meltdown. After consulting numerous market experts, Catherine Rampell of the Washington Post recently projected what might happen if the United States government did not meet its spending obligations following a failure by Congress to raise the debt ceiling:
U.S. Treasury securities—just about the safest investment in the global economy—would suddenly appear insecure. By comparison, every other bond and security in the world would appear less secure as well, since U.S. Treasury securities are basically the world’s economic backstop.
Interest rates—the cost of borrowing money—would rise to account for the uncertainty now baked into the global economy. That would increase the cost of starting or expanding a business, buying a car or home, or really anything involving a loan. Ironically, it would also increase the national debt, as debt-service costs would rise.
With the full faith and credit of the American government in doubt, investors would sell assets based on the dollar, leading to a drop in the value of the dollar in foreign-exchange markets. The dollar’s position as the global financial sector’s currency of choice would come into question, as would confidence in the nation that prints those dollars.
As trust and confidence in the American economic system waned, the stock market would plummet. This would no longer be an investor’s market.
This is where the squeeze hits. Companies counting on interest payments to make ends meet would suddenly be short on cash. They’d ask banks for loans to make payrolls or pay creditors, but banks wouldn’t be eager to lend money. These companies—and anyone financially dependent upon them—would begin to buckle.
With the economy teetering, brokers and lenders would demand that borrowers shore up their accounts or pay back their loans in full. This is a margin call, and it would likely be widespread. Everyone would be selling assets to deposit money in their bank accounts. No one would be investing. Economic activity would contract further.
A panic could set in, overwhelming the world’s financial infrastructure. Unsure of whether they would have the ability to move money as needed if the crisis reached them, investors everywhere might take preemptive steps to shore up their positions, spreading the panic to every corner of the global economy.
And those are just the basics. Who knows how an unexpected turn of events (i.e., the collapse of a uniquely vulnerable corporation or bank) might ripple through the economy. And the U.S. government—whose failure to guarantee its credit-worthiness initiated this crisis—could not be counted on to come our rescue.
So yes, it would be a good idea for the U.S. government to pay its bills, meaning Congress should indeed raise the debt ceiling. According to Treasury Secretary Janet Yellen, this needs to happen by June 1 or else. (I saw a report Friday suggesting there may be some revenue coming in that could push that date to sometime in July, but I wouldn’t rest easy on that.) No-brainer, right? The problem is House Republicans oppose a clean hike and have attached a number of demands—including the repeal of a big chunk of the Inflation Reduction Act—to their bill to raise the debt ceiling. President Biden and congressional Democrats consider that unacceptable and instead expect Congress to simply raise the debt ceiling, no strings attached. Thus, showdown.
Americans hate these sorts of legislative showdowns and just want the government to figure out a solution, which may lead some to wonder why Biden doesn’t cut a deal with House Republicans to get this all over with. He shouldn’t, and here’s why: It is in neither party’s interest to breach the debt ceiling and wreck the U.S. and world economies, so not only does it make no sense to negotiate with Republicans to get them to do something they should want and need to do, but negotiating with them would only encourage Republicans to make ever more outrageous demands of Democrats in the future in exchange for what should be their pro forma vote. Democrats and Republicans—actually, all Americans—benefit from a dependable economic system that is the bedrock of the global economy and not crashing. So just raise the damn debt ceiling! Yet for the third time in twelve years, Republicans are threatening to tank the American and world economies if Democrats don’t approve their wish list of demands. It’s profoundly stupid.
Allow me to illustrate. Imagine a cruise ship that requires an officer of the watch (OOW) and a helmsman to work together to navigate and steer the ship. Aboard this ocean liner are hundreds of these two individuals’ friends. Midway through the cruise, the OOW spots an iceberg and charts a course around it. Upon learning of the iceberg, the helmsman tells the OOW that if he and his friends aren’t each given $1 million, he will not alter the vessel’s course and crash it into the iceberg.
Here’s one way that scenario might play itself out:
OOW: Hey, there’s an iceberg straight ahead. Let’s steer around it.
Helmsman: I’ll only change course if you give me and each of my friends $1 million.
OOW: Oh crap, I don’t want to crash into that iceberg and send all these people to their deaths! Here’s all the millions of dollars you and your friends have requested.
Helmsman: Thank you. (Pockets money, steers ship clear of the iceberg.)
OOW: Oh no, we’re headed straight for another iceberg!
Helmsman: I refuse to steer clear of it unless you give me and each of my friends $2 million.
OOW: Don’t you just want to avoid it for your own well-being?
Helmsman: I will not hesitate to plow this ship into an iceberg! Give me my money like you did last time!
OOW: (Sigh.) Here it is.
Helmsman: (Pockets money, steers ship clear of the iceberg.) Sucker.
OOW: Oh no, another iceberg…
The problem with the above scenario is that the helmsman actually isn’t a helmsman. He’s a hostage taker, and he’s getting everything he wants—a safe cruise AND millions of extra dollars—for doing the thing he’s supposed to do and that everyone aboard the cruise wants him to do, which is not crash the ship and kill everyone on board.
Here’s another way that scenario might play itself out:
OOW: Hey, there’s an iceberg straight ahead. Let’s steer around it.
Helmsman: I’ll only change course if you give me and each of my friends $1 million.
OOW: No. Do your job and steer the ship around the iceberg. Keeping this vessel afloat is a non-negotiable issue.
Helmsman: But that means you get everything you want!
OOW: No, it doesn’t. It means we get something we both need out of this cruise, which is a non-sunk boat with non-dead passengers. So do your job and steer this ship around the iceberg.
Helmsman: But I don’t like where this cruise is headed. Too many icebergs.
OOW: We can talk about that and make some adjustments later so we don’t encounter as many icebergs on future voyages. But this is the course we’re on right now and both you and I are responsible for steering this ship around icebergs. So steer around that iceberg.
Helmsman: OK, I see your point. (Steers ship around the iceberg.)
That’s a pretty reasonable outcome. Now there’s another way this scenario could play itself out:
OOW: Hey, there’s an iceberg straight ahead. Let’s steer around it.
Helmsman: I’ll only change course if you give me and each of my friends $1 million.
OOW: No. Do your job and steer the ship around the iceberg. Keeping this vessel afloat is a non-negotiable issue.
Helmsman: So I’m not getting my $1 million? Screw you! (Does not change course, ship crashes into the iceberg and sinks, hundreds of people drown.) I regret my decision, I should not have let my ship hit the iceberg, gurgle, gurgle, gurgle.
Of course, there’s another way this could all turn out, too:
OOW: Hey, there’s an iceberg straight ahead. Let’s steer around it.
Helmsman: I’ll only change course if you give me and each of my friends $1 million.
OOW: Oh yeah?. Well, it takes two to turn this ship’s wheel and I’m here to tell you I’m not changing this ship’s course unless me and my buddies get universal child care and pre-K, paid leave, college loan forgiveness, the DREAM Act, a tax hike on the wealthiest 1%—
Helmsman: Whoa, that’s a lot, bro. I’m not giving that to you.
OOW: Then I’m crashing this ship into that iceberg! Full steam ahead!!
I’m pretty sure that scenario wouldn’t happen, though, because the OWW of the ship is a responsible human being who doesn’t want to inflict needless pain upon his passengers.
By now you may be asking yourself why we even have a debt ceiling in the first place. Congress could, after all, require the Treasury to cover all spending obligations and debts resulting from legislation Congress passes. The United States actually did have such a policy in place 30-45 years ago. That changed when Republican Speaker of the House Newt Gingrich realized most people believed “raising the debt ceiling” meant “taking on more debt” rather than (essentially) “paying off debt.” Gingrich made a big deal out of the debt ceiling to make himself look tough on government spending. This was mostly harmless until 2011, when congressional Republicans who also wanted to look tough on spending pushed a debt ceiling showdown to the brink of default and actually got the United States’ credit rating downgraded. Since that time, Democratic presidents have said they will no longer negotiate over the debt ceiling, which, I remind readers yet again, must be raised to avoid economic calamity.
Take a moment to truly appreciate what this all means. First, note how this is an entirely manufactured crisis, one predicated upon voters’ ignorance of what “raising the debt ceiling” actually entails and that could be averted simply by raising the debt ceiling with no strings attached (or, better yet, by eliminating it all together.) All Republicans need to do is walk into their legislative chamber and vote to do what they (presumably) know they need to do, which is raise the debt ceiling/avoid a disastrous economic self-own. If you hate the games Washington politicians play, you ought to despise Republicans for inflicting this debt ceiling drama upon us.
Secondly, much of the public thinks the government’s inability to raise the debt ceiling is yet another example of how Republicans and Democrats can’t work together for the country’s sake, but that’s not what’s going on here at all. Instead, what’s really happening is that Republicans are counting on Democrats’ sense of responsibility to keep themselves [the Republicans] from doing something utterly irresponsible and that would seriously harm the country. If, however, Democrats insist Republicans take it upon themselves to simply act responsibly—as Democrats currently are, and which is an entirely reasonable demand—Republicans will insist upon acting irresponsibly. In short, Republicans expect Democrats to act responsibly but do not expect the same of themselves. And they do this because they believe voters will reward them for it. That’s messed up.
We’ve seen this movie before with Republicans. On January 6, 2021, Donald Trump essentially told Congress to invalidate the legitimate results of the 2020 election or he would send a mob to the Capitol to wreck American democracy. No one in their right mind would blame Congress for the ensuing riot by claiming Congress should have taken Trump’s threat seriously and caved to his demands. Instead, the fault lies with Trump for refusing to do the responsible thing, which was accepting the results of the election and ensuring the peaceful transfer of power. Congress is not responsible for making Trump do the responsible thing; instead, people should just expect Trump to act responsibly.
Which brings us to Trump’s appearance on CNN this past week. Here’s what he told moderator Kaitlan Collins about the debt ceiling:
Trump: I say to the Republicans out there—congressmen, senators—if [Democrats] don’t give you massive cuts, you’re going to have to do a default. And I don’t believe they’re going to do a default because I think the Democrats will absolutely cave, because you don’t want to have that happen. But it’s better than what we’re doing right now, because we’re spending money like drunken sailors.
Collins: So just to be clear, Mr. President, you think the U.S. should default if the White House does not agree to the spending cuts Republicans are demanding.
Trump: We might as well do it now because we’ll do it later, because we have to save this country. Our country is dying. Our country is being destroyed by stupid people, by very stupid people.
Collins: You once said that using the debt ceiling as a negotiating wedge just could not happen. You said that when you were in the Oval Office.
Trump: Sure, that’s when I was president.
Collins: So why is it different now that you’re out of office?
Trump: Because now I’m not president.
[Crowd laughs and applauds.]
It’s all on display right there: The misleading claim that raising the debt ceiling is about spending money rather than paying the bills, the reckless and unnecessary brinksmanship, a fleeting acknowledgement of just how serious this situation is abutted by a could-care-less statement affirming his willingness to plunge the United States and the rest of the world into an economic catastrophe, the expectation that Democrats but not Republicans have to act responsibly, and the nakedly hypocritical admission he wouldn’t be playing any of these games if he was in a position of responsibility. There’s even a bit of projection when he says the “country is being destroyed…by very stupid people.” His comments earned laughter and applause from the Republican voters in the hall.
Trump has taken American democracy hostage in the past. Now he and the Republican Party are holding America’s economy for ransom and preying on others’ sense of responsibility to get their way. It should disqualify them from office. Here’s how that cruise ship scenario should really play itself out:
OOW: Hey, there’s an iceberg straight ahead. Let’s steer around it.
Helmsman: Good idea. (Steers around the iceberg.)
First Mate: Wait, what happened to the old helmsman?
OOW: When the passengers heard he was about to crash the ship into an iceberg, they threw him overboard and found a helmsman who agreed to avoid icebergs.
First Mate: I have to say, that makes a whole lot of sense.
Yeah, makes a lot of sense to me, too.
Signals and Noise
Don Trump was found liable in a federal civil case for sexually abusing and defaming E. Jean Carroll. Trump will need to pay Carroll $5 million in damages.
If you did not watch Don Trump’s appearance on CNN last week, Jake Lahut of The Daily Beast has a good run-down/critique.
Charlie Sykes of The Bulwark does a good job looking at the political significance and implications of the town hall. (“The reality, however, was far ghastlier: a sh*tshow for the ages, and a moment that captured the thorough degradation of both our politics and the media. ‘It was a f**king nightmare,’ remarked one savvy observer, ‘and it was programmed to BE a f**king nightmare.’”)
Reliable Sources by Oliver Darcy, CNN’s daily newsletter, did not hold back in presenting critiques of CNN’s decision to air the Trump town hall. (Darcy got called into CNN chairman Chris Licht’s office for a talking-to after publishing that article.)
Tara Palmeri of Puck reports the mood in the town hall (which was filled with Republican voters) wasn’t quite what it appeared to be on TV. (“There were plenty of people in that room that were ardent supporters of President Trump, and no matter what he said, they were ready to jump out of their seats and applaud. But there were also people that sat there quietly disgusted or bewildered. In a TV setting, you hear the applause, but you don’t see the disgust. So Trump did not have the entire room on his side, make no mistake, even if it certainly came across that way on TV.”)
If you ever get the chance to interview Trump, Kara Swisher has some advice.
Michael Fanone, a Capitol Hill police officer injured on 1/6, would like to know why CNN turned precious prime time minutes over to a guy who tried to get him killed.
Trump may have dug himself into a deeper legal hole with his comments about the classified documents he took with him to Mar-a-Lago and refused to return to the federal government.
By Will Saletan: The Corruption of Lindsey Graham: A Case Study in the Rise of Authoritarianism. It’s a brief book, available for free on Substack. (“I’m not interested in what’s distinctive about Graham. I’m interested in what isn’t. How does his story illuminate what happened to the whole Republican party? How did the poison work?…The surrender to despotism doesn’t happen all at once. It advances in stages: a step, a rationalization. Another step, another rationalization. The deeper you go, the more you need to justify. You say what you need to say. You believe what you need to believe.”)
Oath Keeper founder Stewart Rhodes, who the government wants to lock up for 25 years for his role in the 1/6 riot, has asked for a lenient sentence due to the “good works” he’s performed by (no kidding) founding and leading the Oath Keepers.
Republican Alabama Senator Tommy Tuberville has no problem with letting white nationalists serve in the military. He’s supposedly really pro-military but he’s currently holding up 184 military promotions because he doesn’t like the DOD’s policy of reimbursing service members for travel expenses for crossing state lines to obtain an abortion or get fertility treatments. (Remember: Service members get little to no say in where they’re stationed.) Tuberville also this week said the jury’s decision to hold Trump liable for sexual abuse makes him want to vote for Trump twice (which is repulsive, but also the sort of behavior Trump would accuse Democrats of.) By week’s end, Tuberville was still digging, telling reporters, “I look at a White nationalist as a, as a Trump Republican. That’s what we’re called all the time, a MAGA person, that’s what I’m just that. Well, I agree that we should not be characterizing Trump supporters as White nationalists.”
Actually, Tommy, it is fair to characterize Trump supporters as White nationalists, particularly since an event this weekend at Trump’s Doral resort featuring notable MAGA conservatives included two speakers who have praised Hitler.
A far-right faction of the Georgia GOP that has had it up to here with GOP Gov. Brian Kemp and Secretary of State Brad Raffensperger wants to grant the state party the power to disqualify candidates from running as Republicans if they aren’t sufficiently conservative or are “traitors” to the party. No word on if they would allow traitors to the Constitution to run as Republicans, however.
JP Morgan Chase CEO Jamie Dimon warns the run-up to a debt default would be as catastrophic as the actual default, as an economic panic anticipating default could crash the economy.
Sarah Binder of the Brookings Institute says we shouldn’t count on a discharge petition rescuing us from the debt ceiling crisis.
Ian Milhiser of Vox looks at whether the 14th Amendment renders the debt ceiling unconstitutional (and what the Supreme Court might think about that question.)
Politico reports House Republicans are now trying to include border legislation in the debt ceiling deal.
Lost in the coverage of the end of Title 42 is the genuine suffering so many of those who are hoping to enter the United States have endured. Natalie Kitroeff and Julie Turkewitz of the New York Times investigate what is driving the record levels of migration to the U.S. border with Mexico. (“While migration to the U.S. southern border has always fluctuated, the pandemic and the recession that followed hit Latin America harder than almost anywhere else in the world, plunging millions into hunger, destitution and despair. A generation of progress against extreme poverty was wiped out. Unemployment hit a two-decade high. Russia’s invasion of Ukraine choked off a key pipeline for grain and fertilizer, triggering a spike in food prices. Economic shocks were worsened by violence, as conflict between armed groups festered in once relatively peaceful countries and raged in places long accustomed to the terror. Amid these events, smugglers and migrants alike have pushed powerful social media campaigns, many rife with misinformation, that have encouraged people to migrate to the United States.”) From that same article: A photograph by Federico Rios of a group of migrants crossing through the dangerous Darien Gap in Panama.
Meanwhile, the surge in immigration across the U.S./Mexico border many predicted has yet to materialize. Perhaps because the large number of migrants stuck on the Mexican side of the Rio Grande has turned into a humanitarian crisis for Mexico. Still, Biden is getting hammered from the left and right on immigration.
Republican megadonor and Supreme Court Justice Clarence Thomas’s Secret Santa Harlan Crow has refused to provide the Senate Finance Committee with a complete accounting of the his gifts to Thomas over the past two decades. Given the value of these gifts, Crow should have reported them on his taxes.
A federal grand jury indicted Republican New York Rep. George Santos on thirteen criminal charges, and he’s screwed. One of the charges—fraud, related to Santos seeking unemployment assistance during the pandemic when he was drawing a $120,000 salary—came the same week that Santos voted for a bill he co-sponsored that would crack down on people who sought to defraud the government of unemployment benefits during the pandemic. As David A. Graham of The Atlantic wrote, “George Santos Would Have Been Better Off Losing”.
The Republican-led House Oversight Committee promised to finally show how the Biden family profited off its connections to foreign businesses and countries. Despite the insinuations, their investigation pretty much proved Joe Biden had nothing to do with the attempts by his son to profit off the family name. But as Philip Bump of the Washington Post points out, the big question coming out of their report is why the Committee isn’t looking at similar and much more credible charges related to Don Trump and his family.
By Nicole Narea of Vox: “Mental Illness is Not Responsible for America’s Guns Crisis”
Paul Waldman of the Washington Post asks “How Many Guns Will It Take to Make Us Safe?”
Republican Senator Marsha Blackburn of Tennessee (sigh, Tennessee again) has an idea about how to keep schools safe: Armed grandparents.
Fabiola Cineas of Vox looks at Republican efforts to defund public libraries.
By Ronald Brownstein of The Atlantic: “The Book-Bans Debate Has Finally Reached a Turning Point” (“From grassroots organizers…to political advisers for Biden, more Democrats see book bans as the weak link in the GOP’s claim that it is upholding ‘parents’ rights’ through measures such as restrictions on curriculum or legislation targeting transgender minors.”)
Republican legislators in Louisiana have declined to add exceptions for rape and incest to their state’s abortion ban.
The Republican Florida legislature has approved a bill that would allow the Florida Transportation Department to start paving roads with radioactive material. The bill is being pushed by the fertilizer industry, which produces the radioactive waste. All I can think about is the water run-off. Maybe Florida should slow down on this one…
Republicans have filed an ethics complaint against
state Republicans who conspired to overturn the 2020 electionsa Democratic legislator caught on camera hiding Bibles in the statehouse.In an obvious violation of the First Amendment, the Texas state legislature has passed a law allowing schools to employ chaplains in addition to school counselors. The chaplains would not be required to be certified with the State Board for Educator Certification.
Bryan Slaton, a youth pastor turned Texas legislator known for his family values platform, anti-LGBTQ positions, and for calling drag performers “perverted adults,” was expelled from the Texas House for getting a 19-year-old aide drunk and then having sex with her. (The aide cannot recall if she consented.) Slaton had resigned a day earlier, saying he wanted to spend more time with his family, which, for the sake of his family, he hopefully will not.
“Totally kidding. Sorry. I can never control myself. I’m fundamentally a dick. My apologies.”—Tucker Carlson, after saying he might run for president in 2024.
Marc Fisher of the Washington Post finds a number of car manufacturers are beginning to phase AM radios out of their automobiles.
Edward Wong and Michael Crowley of the New York Times wonder if Ukraine’s pending counteroffensive might set the stage for peace talks?
Ukraine appears to be making advances in the area around Bakhmut.
Russia is building a village on the edge of Moscow for conservative American and Canadian ex-pats.
Former Pakistani Prime Minister Imran Khan was arrested on corruption charges. Khan, a critic of the current government and military, was removed from office last year but has staged a political comeback. The arrest is widely viewed as the work of the Pakistani military, which has always been the power behind the throne in Pakistan. A former cricket star, Khan retains strong support among the Pakistani people. (Khan was released from prison on Thursday.)