Tangle - The debt ceiling standoff.

Episode Date: October 7, 2021

Did Mitch McConnell cave? He has said he would not support raising the borrowing limit because it would allow Biden to push through another $5 trillion of spending, something Republicans don't want. Then he instructed Republicans to sink a government spending bill that suspended the debt limit, forcing Democrats to remove the debt limit language from the legislation in order to keep the government open. Earlier this week, Senate Democrats and President Biden began openly floating the idea of abolishing the filibuster altogether to raise the debt ceiling.Then he proposed a deal: He would agree to rule changes that would allow Democrats to either fast-track the suspension of the debt limit using a budget reconciliation process or raise the limit to a specified figure through December, giving them more time to figure it out later and ensuring the process doesn't get caught up in other partisan wrangling (it'd also take the pressure off Democrats now, as they figure out how to pass the bipartisan infrastructure bill and the $3.5 trillion reconciliation deal).Our newsletter is written by Isaac Saul, edited by Bailey Saul, Sean Brady, Ari Weitzman, and produced in conjunction with Tangle’s social media manager Magdalena Bokowa, who also created our logo.The podcast is edited by Trevor Eichhorn, and music for the podcast was produced by Diet 75.--- Send in a voice message: https://podcasters.spotify.com/pod/show/tanglenews/message Hosted on Acast. See acast.com/privacy for more information.

From executive producer Isaac Saul, this is Tangle. Good morning, good afternoon, and good evening, and welcome to the Tangle Podcast, a place where you get views from across the political spectrum, some independent thinking without all that hysterical nonsense you find everywhere else. I am your host, Isaac Saul, and on today's episode, we are going to be talking about the debt ceiling, Senator Mitch McConnell, and some of the action that happened in Congress over the last 24 hours. A little bit of an interesting standoff, maybe coming to a conclusion. Before we jump in, as always, we'll start with the quick hits, the news you need to know.

First up, and this is an update on a previous story we've given a lot of coverage to, a federal judge in Texas has temporarily blocked the state's new anti-abortion law. However, clinics could still face retroactive lawsuits because the ruling isn't permanent, so it's unclear how it will impact some patients there. how it will impact some patients there. Number two, Pfizer has asked the FDA to authorize its vaccine for children 5 to 11 years old. Number three, a new Senate report has detailed how Justice Department officials fought off former President Donald Trump's push to investigate claims the election was stolen from him. Number four, a small number of U.S. troops have been deployed to Taiwan to help train local forces as the threat from China rises. Number five, U.S. gasoline prices rose to an average of $3.22, with some stations charging more than $5 per gallon, the highest prices we've seen since October 2014. All right, those are our quick hits. If you want anything more from those

stories, you can check out our newsletter where we have links to each of them inside. That brings us to our major story of the day, today's topic, which is Mitch McConnell and the debt ceiling. Yesterday, the Senate minority leader opened the door for Democrats to raise the debt limit. Democrats say McConnell, the Republican senator from Kentucky known for his shrewd methods in the Senate, folded. That's the same thing former President Donald Trump is saying too. First, let's remind you what's going on here. The debt ceiling is the maximum amount that the United States can borrow. Our government borrows money when the Treasury Department issues government securities or treasury bonds that other countries and institutions buy. That money infuses the government with cash, and it means our debt is owned by U.S.

institutions, the U.S. public, and other nations. We have explained how this works in a previous September episode and newsletter. Treasury Secretary Janet Yellen has said recently that we need to raise our debt ceiling limit in the next few weeks or we risk defaulting on our debt. Something like that could set off a global financial crisis. Historically speaking though, the debt ceiling is a bit of a joke in Congress because we always end up raising or suspending it when we get close to hitting it. It's been raised 78 times since 1960, 49 times under Republican presidents, and 29 times under Democratic presidents. The last time it was suspended was under President Trump in August of 2019,

but that doesn't stop members of Congress from using threats not to raise the debt ceiling as leverage. So, what's this got to do with McConnell? He has said he would not support raising the borrowing limit because it would allow Biden to push through another $5 trillion of spending, something that Republicans don't want. Then he instructed Republicans to sink a government spending bill that suspended the debt limit, forcing Democrats to remove the debt limit language from the legislation in order to

keep the government open. That started a game of chicken that's been going on for the last couple weeks. Democrats could have raised the borrowing limit on their own, but it would require passing it in a reconciliation bill or picking a specific number to raise the debt ceiling to. Both are risky propositions politically and for the nation's economy. Democrats said if they included it in reconciliation, for instance, but the bill failed for another reason, we'd end up running out of time and defaulting on the debt anyway.

So then what happened? Earlier this week, Senate Democrats and President Biden began openly floating the idea of abolishing the filibuster altogether to raise the debt ceiling. The filibuster, a reminder, is the Senate rule that essentially ensures most big legislation needs 60 votes to become law. Mitch McConnell does not want Democrats to abolish the filibuster because Republicans are currently a minority in the Senate. It's a 50-50 split, but Democrats have the tie-breaking vote, courtesy of Vice President Kamala Harris. According to reporting from Politico and Axios, McConnell fears the pressure to abolish the filibuster was ramping up on some of the

moderate members of the Senate, so he decided to come forward with a deal to move the debt ceiling. The deal McConnell proposed presents two options. He would agree to rule changes that would allow Democrats to fast-track the suspension of the debt ceiling using a budget reconciliation process or raise the limit to a specified figure through December, giving them more time to figure it out later and ensuring the process doesn't get caught up in other partisan wrangling. It would also take the pressure off Democrats now as they it out later and ensuring the process doesn't get caught up in other partisan wrangling, it would also take the pressure off Democrats now as they figure out how to pass the bipartisan infrastructure bill and the $3.5 trillion reconciliation bill. Reactions to this were actually pretty similar across the political spectrum.

Senator Elizabeth Warren said McConnell caved. Former President Trump said looks like Mitch McConnell is folding to the Democrats again. McConnell himself seemed to allude to the threat of losing the filibuster as the reason for why he did what he did. He said, it's not clear whether the Democratic leaders have wasted two and a half months because they simply cannot govern or whether they are intentionally playing Russian roulette with the economy to try to bully their own members into going back on their word and wrecking the Senate, he said on the Senate floor. Either way, it means if the Democrats take the punt, the debt ceiling crisis will be pushed off until December, and the party can focus all

of its energy on figuring out how the two-track process for the infrastructure and reconciliation bills will work. Below, we'll take a look at some of the latest commentaries on the debt ceiling, the filibuster, McConnell, and where things are right now. Alright, so first off, we'll start with what the right is arguing. In the National Review, John McCormack says McConnell's latest move reveals the Democrats' deception. In the current debt ceiling standoff, the Democratic argument essentially boils down to this. Republicans help create the debt, therefore they should help raise the debt ceiling. The Republican argument essentially boils down to this. Democrats are on a partisan spending spree,

therefore they should help raise the debt ceiling by themselves to make room for their new spending. Maybe you find one of these arguments more persuasive than the other, but one thing separating Senate Majority Leader Chuck Schumer from Senate Minority Leader Mitch McConnell this week is that Schumer hasn't been telling the truth about what he has the power to do. Schumer has been pretending for several days now that the Senate Democrats simply lack the time to raise the debt ceiling through the reconciliation process. This requires a simple majority without having to overcome the usual 60-vote hurdle. That was not, and still is not, true. A voterama, the long series of non-binding amendment votes required during the reconciliation process, takes a matter of hours, not days. The earliest the U.S. Treasury might exhaust its borrowing authority is October

18th. McConnell has now made Schumer an offer that makes it plain to absolutely everyone that the Democrats have the time and the power to raise the debt ceiling through reconciliation. The Wall Street Journal called this the debt ceiling deception. Democrats keep telling Americans they have the votes and the mandate to pass the biggest tax increase since 1968 and the biggest domestic spending bill ever, the board said. Yet they also claim they're helpless to raise the federal debt ceiling without Republican votes. But no one is preventing Democrats from doing their job. The parliamentarian has already said Democrats can use reconciliation to raise the debt limit. So why won't they do it? As it happens, Mr. Biden gave that game away when he was asked Monday why Democrats aren't using reconciliation.

There is a process, Biden said, that would require literally up to hundreds of votes. In other words, Mr. Biden admits that Democrats could raise the limit via reconciliation, but then they'd also have to take difficult votes on many issues on the Senate floor. Some of those votes might be unpopular. Mr. Biden is admitting that the real reason is political, that Democrats want Republicans to spare them from having to take those tough votes. In the New York Post, John Podorec pointed to 2006 when Democrats opposed a debt ceiling increase to punish Republicans. And all the major players this time were there that time, he wrote. One such Democrat casting a vote against raising the debt ceiling was current Senate Majority Leader Chuck Schumer.

And what of the president? Here's what Joe Biden, then a senator, said in 2006. Quote, because this massive accumulation of debt was predicted, because it was foreseeable, because it was unnecessary, because it was the result of willful and reckless disregard for the warnings that were given, I am voting against the debt limit increase. Oh, and here was President Barack Obama in 2006, quote, the fact that we are here today to debate raising America's debt limit is a sign of leadership failure. I therefore intend to oppose the effort to increase America's debt limit, close quote. Why are Democrats raining fire and

brimstone down on Republican heads when they know this is a game they've played themselves? Simple. Democrats can raise the debt limit without a single Republican vote, but only if they use the process known as reconciliation. When you use reconciliation to pass a bill, you have to face multiple amendments to the bill on the floor of the Senate. This process has come to be known as a voterama. Democrats know Republicans will use the voterama to force them to vote on bills they would prefer not to cast an up or down, yes or no on. Matters like police funding or support for critical race theory or support for oil pipelines. All right, so that's it for the right's take. Here's what the left is saying. The left is arguing that McConnell got out over his skis and now he has to backpedal.

In the New York Times, Gail Collins said it looked as if things might go the other way for a moment. But at nearly the last minute, Mitch McConnell decided he'd graciously allow the Senate Democrats to pass an extremely modest, very short-term debt limit extension, Collins said. What brought McConnell around? Do you think he's been reminding himself while brushing his teeth at night of the last time his party worked with Democrats on the debt ceiling and got cooperation? Is it possible that while donning his pajamas, he recalled that a vast, vast amount of the last time his party worked with Democrats on the debt ceiling and got cooperation? Is it possible that while donning his pajamas, he recalled that a vast, vast amount of the debt we're worried about, nearly $8 trillion worth, was run up under the presidency of one Donald Trump? Nah, just fluff the pillow, she said. This deficit fight is far from over. The Republicans, following McConnell's lead, are going to keep pretending that borrowing money to pay the

government's bills is a new phenomenon invented to support Joe Biden's agenda. One of the deeply ironic aspects of McConnell's sudden demand that the Democrats be forced to raise the debt limit with as many difficult votes as possible is his own enormous affection for accomplishing his goals in the equivalent of a legislative closet. Clearly, a guy who wants to be remembered for an action was going to have a lot of fun not helping the Democrats keep the economy from collapsing. E.J. Dion Jr. wrote that thanks to McConnell, even Biden is losing faith in the filibuster. No one in Washington disputes Senate Minority Leader Mitch McConnell's cleverness, his understanding of the Senate rules, or his skill at tying Democrats in political and procedural knots. But this time, the Kentucky Republican's cleverness may have caught up with him. By risking economic havoc in refusing to give Democrats a clean chance to suspend the debt ceiling, McConnell may destroy the very

arrangements that have afforded him so much power. Until this week, McConnell could count on President Biden's affection for Senate traditions to keep in place a filibuster that vastly enhances the minority party's power by requiring 60 votes to pass most measures, and not the simple majority our Constitution's authors envisioned. But late Tuesday, Biden met McConnell's hardball with some hardball of his own. Asked by a reporter if Democrats should consider altering the filibuster rules to get a debt ceiling vote through, the president replied, oh, I think that's a real possibility. By Wednesday afternoon, McConnell seemed to feel the heat. To take the pressure off his caucus, he offered Democrats a path to raise the debt ceiling temporarily into December.

Senate Democrats saw the move as McConnell blinking. In CNN, Joe Lockhart wrote that McConnell blinked. This time, Republicans didn't even bother to give a real reason for opposing the debt ceiling increase, Lockhart wrote. They are boldly saying they want only Democrats to vote for raising the limit so every Republican can say they voted against it. Senators Tom Tillis and Josh Hawley, among others, made clear Wednesday that this is all about blaming the Democrats, not about paying our bills. Another potential credit downgrade, a stock market plunge, or a worldwide financial crisis are all worth it if it inflicts political damage on President Joe Biden and the Democrats. It's more than likely that Republicans in the end will make some sort of deal that keeps us from falling off the fiscal cliff, he concluded. But the relevance of this

debate is that it makes plain what Republican leaders are all about, not making the country stronger or more prosperous, but simply inflicting as much damage as they can on the current president, whatever the consequences for the rest of us. All right, that is it for the left's take, and that brings us to my take. Whoops. I think the read that Mitch McConnell got a little bit out over his skis here is accurate. I also think it can coexist with the fact Democrats are fibbing about what they can and can't do about it. Let's start there.

The Senate parliamentarian has made it clear that Democrats could pass a debt limit increase without disrupting the process of the reconciliation bill. Punchbowl News, an insider newsletter for all things Congress, reported it this way, quote, According to the parliamentarian's office, Democrats could raise the debt ceiling through reconciliation without impacting the existing reconciliation package. The legislation would stay on its own separate track and not lose its privilege in the Senate, meaning it can't be filibustered and would only require a majority vote for approval. That seems pretty clear-cut to me. Everything the conservative writers argued above is also true. Democrats are not insisting on Republican votes because they

fear defaulting on the debt. They're insisting on Republican votes because without them, they'll have to raise the debt limit through reconciliation. It'll be a monster distraction, and Republicans will pummel them with amendments to get them on the record as supporting things that are unpopular in swing districts. So there you have it. That's how Congress is working these days. But don't think for a moment that the calculation isn't as political on the Republican side, too. This opposition is not about fiscal responsibility. It's about politics. Republicans don't just want to force through tough votes on Democrats. They don't want to be seen as supporting the Democratic agenda in any way. And that's what this is really about. Showing their

base, they'll do whatever they have to do to undermine the president and slow things down in Congress. The calculation is just as cynical and just as political as what Democrats are doing, and that's where McConnell made his mistake. In seeing the debt ceiling vote in a vacuum, he figured Republicans would win politically. Democrats control everything, so if the worst case happens and we default on the debt, they'll get the blame. They raise the debt limit without Republicans, they have to take the tough votes, and they'll be framed as fiscally irresponsible.

What he didn't imagine was that their patience would wear so thin with his political maneuvering that they might just blow up the filibuster and pass the debt ceiling without reconciliation, meaning no damaging votes and no dealing with Republicans' political traps. And that is when he blinked. We have it on good authority from multiple sources, Axios, Politico, Punchbowl News, wherever you want to go, that the filibuster threat was at the heart of McConnell's offer, and everything we know about him would support that hypothesis. He basically said as much on the floor of the Senate. I certainly buy it. Democrats might still face a tough debt ceiling vote in December, but by then they could have four trillion dollars

that Democratic priorities pass, and most Americans will be tuning out for the holidays anyway, which is a pretty ideal time to cast a meaningless vote on something like police funding in the middle of the night that may or may not be used against you in a political ad a year later. Of course, all of this together just clarifies what I said a month ago. We should just abolish the debt ceiling altogether. It's a completely meaningless political cudgel that will never hit because the consequences are far too grave. So now its only purpose is to be used in moments like this. Games of political chicken where the only people who are

going to truly lose are us. If we want to rein in spending, we can find a new way. The debt ceiling should go for good or should just be raised to such an astronomical number we'll never have to deal with it again. All right, that's it for my take, and that brings us to today's listener question. This one comes from Shelly in Columbus, Ohio. She wrote, I know cash welfare has been wildly unpopular for many decades. However, with the new report showing that government assistance, both stimulus checks and unemployment, has lifted millions out of poverty, I'm wondering do you think we will see any changes in regard to increased welfare? Will cash government assistance become more positively viewed by U.S. citizens? My reply here is yes, definitely. One thing I think we learned from 2020 was just how popular and attention-grabbing cash to citizens is.

Andrew Yang got loads of free press for making it the heart of his presidential campaign. learned from 2020 was just how popular and attention-grabbing cash to citizens is. Andrew Yang got loads of free press for making it the heart of his presidential campaign. And even though he never got much traction, there's good reason to believe that was due to his inexperience and some of his political gaffes and stuff, not his policy proposal that was at the heart of his campaign, which was universal basic income. More Americans still oppose than support universal basic income, according to a 2020 Pew research poll we have. That said, 54% of Americans oppose it and 46% support it. But cash government assistance is clearly popular, not just when it comes in the form of stimulus checks, but also as

things like child tax credits. The biggest thing to understand, though, is that the divide is not so much political as it is related to age. In the same 2020 Pew poll cited above, 67% of Americans under the age of 30 supported UBI, while just 33% opposed it. That support includes 41% of Republicans aged 18 to 34, even though they also make up the overwhelming share of opposition on the whole. Yang demonstrated this simple and effective political messaging around UBI. The government sucks at everything besides cutting checks, so rather than putting that money into the bureaucracy of some new aid program ripe for waste and logistical issues, why not just write checks for Americans? For those who believe the

government should have an effective social safety net, I think the proposition is actually going to resonate across party lines. So yes, I could definitely see a world where cash welfare, straight cash to citizens, gets a lot more popular in the coming years. All right, and that brings us to our story that matters today, which is also a pretty important and maybe semi-feel-good story. It's hard to say it's a feel-good story. But anyway, COVID-19 delta wave, it appears to be falling behind us. Cases have dropped 22% over the last two weeks.

We're still seeing 100,000 plus new cases per day, which a year ago was an astronomical number, but now it represents a serious slowdown from where we were just a few weeks ago. Deaths and hospitalizations are also falling, meaning the worst of this wave may truly be behind us, even as some 1,800 Americans still die from COVID every day. The question is what happens now. In some countries, after Delta, quote, burned out, overall cases fell precipitously to near zero. But in other places, it has kept spreading slowly and steadily and still is today.

So the question is, what will happen in the states? The good news is we seem to be away from the peak and moving down pretty quickly. Axios has a pretty handy map on how things are going on a state-by-state basis. If you want to check that out, it's in the newsletter. All right, and that brings us to our numbers for the day, which are tied to our big main story. 11. That is the number of days until it's expected we will default on our debt. 39% is the percentage of Americans who say they would blame both parties if we defaulted on our debt. 31% is the percentage of Americans who said they would blame Democrats if we defaulted on our debt. 20% is the percentage of Americans who said they would blame Democrats if we defaulted on our debt. 20% is the percentage

of Americans who said they would blame Republicans if we default on our debt. 11% is the percentage who said they don't know or don't have an opinion. All right, this is going to be really hard. Okay, this number is $5,717,770,279. That's the national debt in 1917 when the debt ceiling was created, about $5.7 billion. Today, as of this writing this morning, the national debt was $28,848,041,542,421. I think I got that right. That's about $28.8 trillion. Wow. All right. And that brings us to our have a nice day story, which hopefully can cheer you up. This is actually a really special one, a huge one that is actually kind of close to my heart because it's something I've reported on in the past and have cared about quite a bit for many years. Yesterday, the World Health Organization approved the first ever malaria vaccine.

This is huge news. Malaria kills about 500,000 people a year. Around half of them are children who are living in Africa. And the new vaccine, it's not perfect. Experts say its efficacy, I think, is about 50%. But it will turn the tide significantly and reduce death in places that have been hurt most by the parasite. One estimate suggests it could save tens of thousands of children each year. Along with being the first ever malaria vaccine, it's also ever the first ever vaccine against any parasitic disease.

So it's huge news in a number of ways. The New York Times has an awesome feature on it today. All right, everybody, that is it for our podcast. It's Thursday. That means you probably won't hear from us again until Monday, unless something really extreme happens in the next 24 hours. But if you want to hear from us tomorrow,

you can subscribe to our newsletter. There are always Friday editions for subscribers only. Also, while I have you, I want to remind you that you can support this podcast by going to our episode description and clicking the link to support. And you can also this podcast by going to our episode description and clicking the link to support. And you can also donate to Tangle. There are always links to donate if you want to just do a one-time donation in the newsletters. All of that money, all of that support, it helps. It's a huge deal for us. It allows us to do things like this and to stay ad-free and independent,

although maybe one day this podcast will have a sponsor or two if we get big enough. Keep spreading the word. Thank you guys. Have a great weekend, and you'll hear from us on Monday. Our newsletter is written by Isaac Saul, edited by Bailey Saul, Sean Brady, Ari Weitzman, and produced in conjunction with Tangle's social media manager, Magdalena Bokova, who also helped create our logo. The podcast is edited by Trevor Eichhorn, and music for the podcast was produced by Diet75. For more from Tangle, subscribe to our newsletter or check out our content archives at www.readtangle.com. Bye.