Kevin McCarthy Gets His Budget

Lincoln Mitchell
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The USA, (Brussels Morning Newspaper) It’s a good thing the Republicans don’t control the White House and both houses of congress, otherwise we might have a budget agreement that freezes all non-military spending, expands punitive and pointless work requirements for people receiving government assistance while not increasing the minimum wage, cuts funding to the IRS making it more difficult for that agency to effectively collect revenue and calls for restarting student loan repayment-all this while only extending the debt ceiling for two years.

We don’t have a Republican trifecta in Washington, but it looks like that is the deal the President Biden made with House Speaker Kevin McCarthy in order to increase the debt ceiling and therefore avoid a domestic, and likely international, financial crisis. It is very difficult to look at this agreement and conclude anything other than that it is a big win for McCarthy and the Republicans. This is a budget agreement, and let’s not call it anything else, that would have made Paul Ryan, George W. Bush, Jack Kemp or Ronald Reagan proud. It remains true that McCarthy still needs to secure the votes for the agreement from his caucus, but any Republican who does not support this deal is doing so out of animus for McCarthy rather than rational conservative policy concerns.

For the last few years the Republican Party has sought to reposition itself away from a party organized around conservative economic policy and into an angry populist voice for the white working class. This budget agreement demonstrates that the GOP still has a long way to go in this area. Cuts to the IRS will not affect working people whose taxes are withheld in their paychecks, but will make it easier for the very wealthy to avoid paying their share of taxes. Work requirements, particularly without a corresponding bump in the minimum wage, only accelerate the cruel nature of the current American social contract in which people must work way too much for jobs that pay way too little or risk starving and becoming homeless. Freezing spending means that there can be no new or expanded programs to help working people in times of economic uncertainty or crisis. 

Make no mistake, this is a budget agreement negotiated by a Republican leader who still understands that at the end of the day his party needs to respond to the wealthy donors and Ayn Rand addled ideologues that have set GOP economic policy the last half century.

Biden has had several important legislative successes during his time as president including the passage of the Inflation Reduction Act and the Infrastructure Bill, but this debt ceiling negotiation has been a big defeat. After initially saying he simply would not negotiate, Biden not only negotiated with McCarthy, but he gave away far too much. This is substantially due to the administration’s inability, and perhaps even unwillingness, to effectively message to the American people. The administration should have not only been telling the American people how the McCarthy and his Republican caucus were threatening to crash the American economy, but also how Republican demands would badly hurt so many Americans. The administration did some of the former and almost none of the latter. The debt ceiling negotiations ended up seeming like something done discreetly in private-and that gave the Republicans a huge advantage.

Another big advantage McCarthy had in these negotiations was that far right House Republicans have already demonstrated, in large part through their ongoing support for the insurrectionist leader Donald Trump, that they care very little about what is good, or even essential, for the country. Therefore, the Republican’s implicit GOP threat to crash the American economy if they did not get what they wanted was very plausible and had to be taken seriously by the Biden administration. This put Biden in a very difficult position, which was why he was hesitant to negotiate at all. However, budgeting and policy making requires negotiating and an effective president needs to be good at it. 

Like the filibuster, the debt ceiling is a countermajoritarian legislative trump card. It is yet another way to make it more difficult to pass or implement policy that is supported by a majority of the American people. The Republicans chose to have this debt ceiling fight because they didn’t have the votes last December to get the budget they wanted. The debt ceiling and filibuster are more valuable for conservative political forces because they are less concerned governing. Roadblocks to governance, problem solving and policy making are only a problem if you are interested in those ideas. However, for the GOP performative grievance, fealty to Donald Trump and anger are what drives the political agenda rather than any meaningful attempt, even from a conservative perspective, to govern or solve problems.

The debt ceiling discourse is a reminder that the obstacles to governance and implementing reasonable and popular policies, ranging from some regulation on gun ownership to protecting a woman’s right to make her own reproductive choices to paying our debts, are structural and require structural solutions. It is impossible to know when the Democrats will next control both houses of congress and the presidency, but the last few weeks are a reminder that when they do, structural changes like abolishing the filibuster and the idea of a debt ceiling, must be among the first things they do.

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Lincoln Mitchell is a writer and scholar based in New York and San Francisco. He has written extensively about American politics and US foreign policy. He teaches political science at Columbia University.