The House leadership fiasco shows we need to eliminate the debt ceiling once and for all
It's the latest evidence that this very dangerous weapon needs to be destroyed
President Obama used to criticize Congress for "drifting from crisis to crisis," arguing that it's no way to govern. But as the spectacular leadership crisis in the House shows, Congress doesn't so much drift from crisis to crisis as hurtle or tumble from one to the next, and there's an awful big one coming in less than a month. Yet again, America could default on its obligations, unless we raise the debt ceiling by Nov. 5.
We've been through this madness a couple of times before in recent years, and as the record begins to replay, we have to ask: Isn't it time we did away with the debt ceiling once and for all?
In case you banished the last debt ceiling crisis from your memory (and who could blame you), the way this works is that in addition to setting budgets, Congress has to pass a bill authorizing the Treasury Department to issue bonds, the money from which covers the things the government does over and above what can be paid for by tax revenues. Since the government almost always runs a deficit, this is almost always necessary. It dates back to 1917, when Congress passed a law putting limits on Treasury's ability to issue bonds as a way of exerting more control over the executive branch; that, and subsequent alterations to that law, are why we have a debt ceiling. The only other democratic country that has such a ceiling is Denmark, and its ceiling is set so high that it never becomes much of an issue.
For most of a century, our debt ceiling wasn't too big of a problem either. With a couple of minor exceptions, whenever the debt ceiling would need to be raised, members of the opposition would go to the floor of Congress, harumph a bit about the administration's profligate ways, and then the ceiling would be hiked. A few might vote against it (Barack Obama did just that in 2006), but everyone knew that the outcome was a foregone conclusion. That's because actually defaulting would send our economy into a tailspin, and possibly much of the world's as well, since the full faith and credit of the United States of America is one of the key foundations of the global economy.
Everyone agreed on how insane it would be to default — until Obama became president and the Tea Party achieved its victories in 2010, bringing in a new generation of Republicans who were not only incredibly conservative, but also uninterested in governing. They saw maximal confrontation as their very purpose for coming to Washington. And there lay the debt ceiling, a weapon so dangerous nobody had seriously considered using it before. So they forced crises — in 2011, again in 2013, and possibly again now — pushing America to the brink of default.
Now that we're about to go through this again, I'd like to see congressional leaders and presidential candidates asked this question: Why do we need a debt ceiling at all? I'm guessing many of the Republicans would answer, "To constrain spending." But the debt ceiling doesn't constrain spending. Spending levels are set when the Congress passes budgets. The debt ceiling, if it isn't raised, only keeps us from paying for what Congress has already bought.
They might further say, "Well that's true, but the debt ceiling offers another tool to constrain spending." If they said that, they'd be saying that the debt ceiling is worthwhile precisely because you can use it to create a crisis and threaten a meltdown of the American economy.
If that's the only thing it's good for, why on Earth would we want to keep it?
Senate Majority Leader Mitch McConnell has pledged that there will be no default on America's debt, but he only controls one house of Congress. The real question is what will happen in the House. And that House is in chaos, as Republicans try to figure out who among them would actually want the thankless task of leading the Republican caucus.
That chaos is all the more reason for outgoing Speaker John Boehner to act. Since he announced his pending retirement, he has been working on a deal to keep the government open through the end of 2016 — essentially saving the Republican Party from itself, as conservative members push a shutdown to get the administration to submit to their demands (though those demands are always in flux). Many have assumed he'd also strike a deal with the administration to increase the debt ceiling. When he does so, it will pass with mostly Democratic votes — which Republicans will of course consider a betrayal.
As long as he's doing that, why not bring up a bill to do away with the debt ceiling altogether? Once again, Republicans in Congress would object, and the bill would probably pass with mostly Democratic votes. The Republicans would say that Boehner is giving away a valuable weapon — because threatening to destroy the economy can get people to do a lot.
But if we actually started debating whether to permanently do away with the debt ceiling, people might realize that there's no rational reason to keep it. And there might be a chance to restore at least some small measure of sanity to the federal government.