Senior Advisor for Federal Fiscal Policy
House Republican leaders have scheduled a vote today on a “clean” debt limit increase—one that doesn’t tie the increase to other changes in budget or tax policies or other matters. President Obama and Treasury Secretary Tim Geithner have asked repeatedly for such a “clean bill” as the best way to assure that the debt limit is raised in a timely fashion, and to avoid uncertainty that could spook financial markets and harm the economy. So the scheduling of this vote is good news, right? Actually, no.
House Republican leaders scheduled the clean debt limit increase vote for one reason: to defeat it. They believe this will support their strategy of holding a debt limit increase hostage to enactment of a deficit-reduction package they favor that would impose deep cuts in Medicare, Medicaid, and other important programs while protecting Bush-era tax cuts for the wealthiest taxpayers and various dubious tax breaks for large corporations and other special interests.
The White House and Congress need to enact a debt limit increase in a timely manner to reassure the financial markets and the world at large that the United States will never renege on its obligations. Policymakers also need to prevent deficits in coming years and decades from swelling to levels that will damage the economy and the federal government’s ability to meet the nation’s needs. But the vote that House Republicans have planned for today will not move us toward either of these goals.
Instead, today’s expected defeat of a clean debt limit increase could boost fears that a large number of lawmakers are willing to risk substantial long-term harm to the economy and the reputation of the United States.
By encouraging Republican leaders to continue their refusal to consider any increase in revenues as part of deficit reduction, a defeat also may make it harder to begin serious negotiations over a balanced deficit-reduction package of sensible budget cuts and revenue increases — the sort of package that most thoughtful budget experts agree is the only way to deal effectively with our long-term fiscal problems.