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Republicans lock arms to take us over a financial cliff [1]
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Date: 2023-05-08
McConnell is leaving no doubt here: He won’t intervene to help Biden. He told Biden as much in a phone call last week, insisting that it’s McCarthy’s and the Freedom Caucus’ way or the highway on the issue of paying the nation’s bills. He’s joined with McCarthy “until hell freezes,” one Republican senator promised to Politico.
If Congress doesn’t agree to raising the debt limit in the next few weeks, the nation will default on its debts, 25% of which was racked up on the Republicans’ watch in the Trump administration. The U.S. will reach its borrowing limit, or the debt ceiling, in the first week of June. That limit was set by Congress in the last agreement at $31.4 trillion. The government needs to borrow to keep meeting its budgets, and to pay things like Social Security, Medicare benefits, and even the salaries of the military service members.
Default isn’t an option, or at least it shouldn’t be, since economists warn that it would have "massive and far-reaching" impact on global trade, pushing other countries into a recession. The cuts Republicans are now united behind could eliminate 780,000 jobs by the end of next year, and “meaningfully increase the likelihood” of a recession, according to Moody’s Analytics latest report.
That’s the Republican plan heading into 2024: inflict maximum economic pain through default or draconian spending cuts and then pin it on Biden.
Meanwhile, the Biden team is facing a difficult decision: Biden can negotiate with the radicals and hurt the economy, or he can act unilaterally to raise the debt ceiling. So far, that doesn’t seem like an option he’s seriously considering. Treasury Secretary Janet Yellen said over the weekend that Biden using his authority to override Congress on this one would create a constitutional crisis, although many believe the 14th Amendment gives the president authority to go it alone to ensure the government’s bills are paid on time.
Biden has a crisis on his hands either way, and he shouldn’t look to Republicans to help in any way, shape or form. By the end of May, Biden will have to decide whether he wants to test the 14th Amendment to raise the debt ceiling and potentially invoke a constitutional crisis that would play out in court after House Republicans sue for using an untested power, or whether he lets Republicans shove us all off the economic cliff. It’s a stark choice, but one Biden is increasingly likely going to have to make because the consequences will soon be felt by all.
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https://www.dailykos.com/stories/2023/5/8/2168119/-Republicans-lock-arms-to-take-us-over-a-financial-cliff
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