Photo: Kevin McCarthy speaks at a Republican Party event in 2020. Credit: Matt Johnson
Today, as the “debt ceiling” deadline approaches, Joe Biden hosted talks with Speaker of the House Kevin McCarthy along with top House Democrat Hakeem Jeffries and their counterparts in the Senate. It is an absurdity that this meeting even took place, and an absurdity that Biden is using this political drama to falsely posture as the defender of working people.
The debt ceiling — the legal maximum the U.S. government is permitted by Congress to borrow — has been in place since 1917 and for decades had been raised routinely without incident every few years. But beginning in the Obama administration, Republicans have periodically threatened to refuse to raise the borrowing limit unless harsh austerity cuts are made.
There is clearly no democratic mandate for this deeply unpopular course of action. Most governments around the world do not have a mechanism like the debt ceiling — like any other large institution they simply borrow money to pay their debts as those debts become due. But because the Republicans were able to win a narrow majority in the House of Representatives, they are in a position to block any legislation on the matter from going forward until their demands are met.
While Biden is positioning himself in opposition to this particular push, it is important to keep in mind that in other areas he is an enthusiastic participant in efforts to shred what little social safety net exists. Under Biden’s watch, the nationwide moratorium on evictions, expanded food stamp access, wider Medicaid enrollment, and other measures implemented as the pandemic broke out have been cruelly ripped away.
Negotiations between the twin parties of billionaires
By agreeing to negotiations, Biden is opening the door to severe cuts to social programs and legitimizing the right wing’s practice of using the threat of a government default as leverage to extract concessions. Biden administration officials insist they are sticking to their pledge to not negotiate over the debt ceiling. The administration argues that today’s talks were about negotiations over this year’s federal budget, not the debt ceiling. But because the concessions that Republicans are trying to extract around the debt ceiling are reductions in the budgets for crucial public programs, the distinction between the two topics under these circumstances is purely semantic.
The deep cuts that are now on the negotiating table are profoundly concerning for working people. By imposing a mountain of new, onerous paperwork sold to the public as “work requirements,” huge numbers of people would be kicked off of food stamps and TANF. The Republicans are also demanding the cancellation of the partial student loan forgiveness initiative the administration rolled out last year.
The rest of the cuts, according to the Republican proposal, would come from across-the-board spending caps. The amount allocated to “discretionary” items in the budget — essentially all programs other than Social Security, Medicaid and Medicare — would be frozen for 10 years such that the value would be eroded over time by inflation and ultimately be equivalent to an 18% cut. However, key Republican politicians have also suggested that they would not restrict allocations for war and anti-immigrant repression — sparing the Departments of Defense, Veterans Affairs, and Homeland Security from spending caps. Because of the massive size of these departments’ budgets, that would mean that everything else the government does would need to effectively be cut by 51%.
Biden’s presidency and his whole political career has been filled with examples of his tendency to compromise and capitulate in the face of headwinds from the right wing, if he is not already on their side to begin with. For instance, Biden allowed his signature “Build Back Better” reform program to be hollowed out and then finally trashed by Senator Joe Manchin, and Biden failed to take meaningful executive action when abortion rights were shredded by the ultra-right Supreme Court.
What transpires as we approach a debt default will be a highly complex affair subject to pressure from many different directions. Far from being a champion for the interests of working people as this process unfolds, Biden could in fact be an accomplice in the implementation of a vicious anti-worker program.