Democrats Plot Debt Ceiling Fight And Government Shut Down To Thwart Trump Tax Cuts
After 8 years of bashing Republicans for using debt ceiling votes as leverage to try to force spending cuts, Democrats now seem intent upon doing pretty much the same thing, well, at least the ‘using the debt ceiling as leverage’ part. In fact, after repeatedly calling for a ‘clean’ debt ceiling vote (i.e. one without attached conditions) House minority leader Nancy Pelosi recently hinted, in her typical incoherent manner no less, that Democrats may now be looking into using the debt ceiling vote as leverage to thwart Trump’s forthcoming tax proposals.
“I don’t have any intention of lifting the debt ceiling to enable the Republicans to give another tax break to the wealthy in our country. To further exacerbate the challenge that is created when they have their trickle down economics.”
“The president keeps saying ‘the tax bill is moving through Congress,’ it doesn’t exist. It doesn’t exist. So you understand the frustration. It doesn’t exist. There is no tax bill moving through Congress.”
As Bloomberg points out, Democrats have been the key to passing ‘clean’ debt ceiling increases in the past but hypocrisy is not a concept that is well understood in Washington D.C.
It’s unclear how this would work in practice, but Democratic aides in both chambers said they are discussing possible strategies to tie the debt ceiling to blocking tax cuts.
Such an approach would be a significant change for Democrats, who have spent the past eight years arguing that debt ceiling increases should be free from conditions, and could further complicate efforts to raise the government’s borrowing authority when the current limit is reached later this year.
Democrats have been willing in the past to provide Republicans enough support on “clean” debt-ceiling measures to help make up for the loss of votes among conservatives, mostly in the House, who refuse to support them without deep cuts to domestic programs. Democrats were key to helping resolve the 2011 fight over the debt limit, a protracted standoff that contributed to S&P Global Ratings’ decision to downgrade the U.S. to AA+ to AAA.
Ironically, efforts to use the debt ceiling as leverage could, presumably for the first time ever, partially align the interests of Democrats with the most conservative voices in Congress, many of whom would have no problem shutting down the federal government for a while. After being singled out and blamed for the last government shutdown in 2013, the House Freedom Caucus undoubtedly welcomes Pelosi’s sudden support.
Already, members of the House Freedom Caucus have said they will push for spending cuts in this year’s debt-ceiling debate in exchange for their support. On Friday, President Donald Trump’s chief economic adviser, Gary Cohn, said the White House would consider spending cuts or policy changes favored by Republicans in order to avert an unprecedented default. That appears to align him with White House budget director Mick Mulvaney, but against Treasury Secretary Steve Mnuchin, who has called on Congress to pass a “clean” debt-ceiling hike.
“Treasury secretary would love to do a clean debt ceiling — I get that. But if we need to get things attached to get it through, we’ll attach things,” Cohn said on CNBC.
Several conservative groups met at the White House last week to discuss a strategy. Ideas they discussed included caps on mandatory programs such as Social Security and Medicare, extending automatic across-the-board spending cuts and matching any debt-limit increase with spending cuts, according to two participants in the meeting.
Republicans in both chambers are seeking to draft and approve a tax-cut package this year that would lower individual and corporate tax rates, although no proposal has been circulated yet. Several leaders, including Senate Majority Leader Mitch McConnell, have said they want any tax overhaul to be revenue-neutral. But Trump has repeatedly promised large cuts.
So, by all means, fight on Nancy…for one time in your multi-decade political career you may actually slip up and save taxpayers some money.