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Debt Ceiling Fights Never Benefit The GOP

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TC Talks
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Debt Ceiling Fights Never Benefit The GOP

Post by TC Talks » Wed May 03, 2023 6:58 pm

When has a debt ceiling battle ever benefited Republicans? Never.

Pandering is all McCarthy has left and nobody I know needs more disruption with their investments or lives.
The impasse leaves the country with at least five possible scenarios: Biden and House Speaker Kevin McCarthy (R-Calif.) reach a deal on the debt ceiling; rank-and-file lawmakers make an end run around congressional leadership; Congress passes stopgap legislation to delay a default; the White House acts unilaterally to resolve the crisis; or the United States defaults.

Here’s what each case would mean for the country and economy.

1. Biden and McCarthy make a deal

A deal between the president and speaker would be a positive outcome for financial markets, some experts say, but it would come with economic costs.

2. An end run in Congress

Democratic lawmakers have quietly worked for months to set the stage for a long-shot end run around McCarthy and Biden.

Through an arcane device called a “discharge petition,” lawmakers could call a bill to the House floor without the approval of the speaker.

3. A bill to buy more time

Congress could pass a bill to temporarily “suspend” the debt ceiling for several weeks or months to give lawmakers and the White House more time to negotiate a deal.

If lawmakers decided to, they could suspend the debt ceiling until the end of September. That would align a new debt ceiling deadline with another deadline: the budget.

4. The White House acts on its own

There are a two main options for the Biden administration to act by itself to resolve the debt limit question, although the White House has not said it is considering either scenario.

First, Biden could order the U.S. Mint to create something like a coin worth $1 trillion. The White House could then deposit the coin with the Federal Reserve and use that money to pay the government’s bills. But that poses significant downsides, experts say.

5. The United States defaults

If no deal is reached, Congress doesn’t act, and the White House doesn’t do something unilaterally, it’s likely the government wouldn’t have enough money to pay all of its bills. It would “default” on some of its obligations. There is no precedent for the government missing payments like this.

Parts of the government could shut down, sidelining federal services and delaying or suspending safety net programs.


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