Debt ceiling fight practicalities

Because it would play into the false narrative that Dems are fiscally irresponsible? And no Republican would support it.

Better to do away with the procedure properly in a manner that doesn’t have the optics of being irresponsible rather than circumventing it.

Because they don’t have 60 votes in the Senate.

I thought the trillion-dollar coin could be issued by the Treasury without the need for congress to get involved (I very well may be wrong about that).

The Constitutionality of the trillion-dollar coin gambit is uncertain. It could also pose unintended consequences relative to the money supply.

You are vastly overestimating what’s at stake in this “game of chicken”. The financial markets will (quite correctly) give zero credence to the ability of these chumps to make the U.S. actually default on its debt and send the world into financial armageddon. What’s as stake in the worst case is public finances seizing up temporarily - the impact of government workers stopping work and not getting paid, social security payments not getting made, etc. These things would obviously harm vulnerable people and harm the economy, but the stakes are nowhere near as high as default.

To hear the FC tell their side, what they claim to want is if possible to go back to authorizing each individual issuance – explicitly, by individual Act Of Congress rather than implicitly by authorizing the Treasury to issue “up to X” – BUT in either case conditioned to the repayment coming in whole or in part from cuts in Things They Don’t Like.

The other thing I’d like to see, the next time sane people control Congress and the White House, would be a bill that says that, if a year’s budget is ever not passed by the time the new budget is needed, that all spending automatically remains at current levels until such time as a new budget is passed. Republicans would of course try to repeal that, but that would require them to actually accomplish something, as opposed to just stopping all accomplishment.

If this were in place, Congress might never pass a new budget again. It’s the threatened or actual pain of a government shutdown that ultimately gets Republicans to (eventually) agree to pass a budget. If you take that away, why would they ever cave?

Which wouldn’t matter at all if the House is the problem.

Presumably because there would be no route for their donors to extract more money.

It seems to me that, if the MAGA crowd tries to hold things up in the House and absolutely refuse to relent, that just pushes the rest of the Republican party to have to make compromises with the Democrats.

But - IF this happens, why would it be the Crazy Wing that crashes the economy. What would stop the purported non-crazy Rs (if there are any) from proposing some solution enough Dems can agree with? Sure, they would face primaries in the future, but they would actually be able to cite a record of doing their jobs responsibly.

Their donors are small-dollar individuals who just want them to scream about their grievances and corporations who are more interested in tax breaks (which can be done through reconciliation) than direct handouts. Defense industry would go nuts though.

I agree.

What I am unclear on is how much the Freedom Caucus can obstruct things. They are a minority but we have seen them throw a wrench in the gears with great success in the recent nominating of the Speaker.

A handful of people messed up the whole thing.

Kevin McCarthy wants everything that the FC wants.

Look at what the House has passed in the past week.

  • Establishing a Select Subcommittee on the Weaponization of the Federal Government as a select investigative subcommittee of the Committee on the Judiciary.

  • Establishing the Select Committee on the Strategic Competition Between the United States and the Chinese Communist Party.

  • Expressing the sense of Congress condemning the recent attacks on pro-life facilities, groups, and churches.

  • Born-Alive Abortion Survivors Protection Act.

  • To rescind certain balances made available to the Internal Revenue Service.

  • Protecting America’s Strategic Petroleum Reserve from China Act.

That the FC caucus is crazy is a given. People now need to remember that Kevin McCarthy is just as crazy and extrapolate from there.

When you let the crazies put your 'nads in their vice, well … they’re not your 'nads anymore.

McCarthy was happily leaning a long way towards FC-dom three months ago. But now he’s got zero room to lean any way but 100% their way. 'Nads meet vice.

Note from experience in a jurisdiction that has such a provision: any inflation, any contingency expense, any reduction or even non-increase in tax receipts (plus no new debt issue), and the “automatic repeat of last year’s budget” provision will not cover this year. You run into a shutdown or a default before the end of the FY anyway .

The thing is the greenback is the fiat currency of the world. It is ludicrous to imagine that because the fuckwits in the Republican party won’t increase the debt limit to cover what Congress has already approved to spend, the world will suddenly flee the dollar for the Chinese yuan (or pick your currency). This is a Sarah Palin reading of the debt. This is a stoopid, made up procedural crisis that has been going on for far too long.

I do believe the Treasury will issue the trillion dollar coin if it comes to that.

The last time this happened, during the Obama presidency, spreads started widening some when it looked like it was a remote possibility. Moody’s (and I think S&P) downgraded the debt from Aaa to Aa1 or Aa2, again giving default more than zero chance.

Those Republicans were much more reality-based and much less nihilist than these.

I’m not saying we will default. I’m saying that the possibility is higher than anyone is giving credit for, and the results would be catastrophic.

The same thing that let them allow the Crazy Wing to hold the Speakership hostage in exchange for massive concessions of power to the Crazy Wing. The non-crazy wing might not be crazy, but they are clearly cowards who simply won’t stand up to the Crazy Wing on any issue.