ANALYSIS: Debt Ceiling Crisis Tests Biden’s Leadership
Debt Ceiling Crisis: Will Biden Compromise or Continue to Stonewall?
News analysis
For weeks, President Joe Biden successfully shifted responsibility for the debt ceiling crisis onto the shoulders of House Speaker Kevin McCarthy (R-Calif.).
By refusing to risk the “full faith and credit” of the United States in negotiating over the debt ceiling, the president was able to portray the speaker as “holding the economy hostage.” After releasing his 2024 budget proposal on March 9, Biden was able to tell McCarthy, “Show me your plan” for cutting spending and refuse to enter talks until he did.
Now, McCarthy’s victory in uniting the fractious Republican caucus to pass a debt and spending bill in the narrowly divided House of Representatives calls the president’s strategy into question.
As pressure mounts from all sides to end the standoff, Biden faces a choice that could set the tone for his dealings with Congress over the next two years.
Compromise or Stonewall?
Will the president continue to stonewall, betting that the American people will blame Republicans for perpetuating the crisis by proposing extreme spending cuts? Or will he find a compromise solution that resolves the crisis while keeping his legislative agenda intact?
Biden’s decision will likely rest on a triangulation of key factors, including the continued patience of his own party members, the reaction of financial markets to a continued standoff, and the strength of McCarthy’s political position relative to his own.
In the end, the decision may come down to the most basic of all political considerations: what the people want.
Mounting Crisis
When the nation’s statutory borrowing limit of $31.4 trillion was reached in January, McCarthy insisted Congress would not authorize an increase without some agreement to limit future spending.
Biden refused to negotiate, either on the debt ceiling or cuts to federal spending, placing responsibility on McCarthy to first propose a plan for cutting spending.
The situation changed on April 26 when Republicans narrowly passed the Limit, Save, Grow Act along party lines.
“It’s up to you now,” McCarthy said, as if addressing Biden, moments after the bill’s passage. “Whether the economy gets in any trouble, it’s you. Because Republicans raised the debt limit. You have not. Neither has [Senate Majority Leader Chuck] Schumer.”
The bill lifts the debt ceiling by $1.5 trillion, just enough to push the next debt crisis into the 2024 election year. At the same time, it includes spending cuts and other provisions that Democrats find unacceptable.
The proposal reduces 2024 spending to the 2022 level, caps spending growth at 1 percent for 10 years, claws back unspent COVID-19 relief funds, and reinstates work requirements for some SNAP and Medicaid recipients.
And, flying in the face of Biden’s green energy initiative, the Republican plan removes barriers to increased drilling for petroleum and gas.
For the present, Biden has doubled down on his refusal to negotiate.
Managing Democrats
Democrats in Congress are unified in opposing the Republican spending cuts, which they say will decimate the social programs ordinary Americans rely on. But cracks have appeared in the Blue Wall on the question of compromise with Republicans.
Sen. Joe Manchin (D-W.Va.) was the first to criticize Biden’s refusal to negotiate.
“While it is reasonable to sincerely disagree with any specific debt ceiling approach, we will achieve a historic default, and the economic whirlwind which follows, if President Biden continues to refuse to even negotiate a reasonable and commonsense compromise,” Manchin said in a statement on April 20.
“For the sake of the country, I urge President Biden to come to the table, propose a plan for real and substantive spending cuts and deficit reduction, and negotiate now.”
Freshman Rep. Greg Landsman (D-Ohio) offered more terse comments to reporters.
“I don’t think there’s any harm in the two of them sitting down to talk,” Landsman said, as a staffer confirmed for The Epoch Times. “The idea that we’re even coming this close to a potential default is insane.”
Other Democrats have urged Biden to enter talks immediately but have tried to separate the debt ceiling increase from negotiations on the budget.
“Of course, President Biden should sit down with Speaker McCarthy,” Sen. Amy Klobuchar (D-Minn.) said in a televised interview on April 23.
“He should negotiate on the budget. OK, that is the place to negotiate. And they should start those negotiates now, not using the American people and their mortgages as hostages,” she said. “We’ve got to simply make clear we’re going to avoid default and get this behind us.”
Karine Jean-Pierre, White House press secretary, stated the same distinction.
“As the president said yesterday, he is happy to meet with Speaker McCarthy but not to negotiate the debt limit,” Jean-Pierre said at a press briefing on April 27.
Biden’s insistence that there can be no negotiation on the debt ceiling has been based on the idea that there’s no choice but to raise the limit. Both sides have stated that they don’t want a default.
And Democrats often point out that Republicans raised the debt ceiling three times during the Trump administration.
Yet, McCarthy insists that even those increases came only after negotiations with Democrats on future spending
" Conservative News Daily does not always share or support the views and opinions expressed here; they are just those of the writer."
