What happens if Congress doesn’t raise the debt ceiling by December 8? Basic government expenditures like Social Security checks might not go out, the nation’s credit rating could get downgraded, and borrowing money could be subject to much higher interest rates.
A Pennsylvania representative has a solution: eliminate the debt ceiling entirely.
What just happened in 2017
Congress faced a pressing deadline with huge consequences: the debt ceiling needed to be raised by September 29.
If that didn’t happen, essentially the government would have “run out of money.” The debt ceiling is the upper amount that the government is permitted to borrow to pay for spending.
A few weeks ago President Donald Trump struck a deal with congressional Democrats to avoid this September deadline, a deal that some called “a necessary evil.” Yet that deal only extended the debt ceiling by about three months, creating another looming debt ceiling crisis approaching on December 8.
What the bill does
H.R. 3693, introduced by Rep. Brendan Boyle (D-PA13), would eliminate the debt ceiling and allow the government to spend whatever amount it wants, regardless of staying within the debt ceiling’s caps.
That’s it. The entire bill is one sentence long.
It hasn’t attracted any cosponsors yet, and awaits a vote in the House Ways and Means Committee.
What supporters say
Boyle argues the debt ceiling is a dangerous practice which frequently risks an economic crisis, for no real good reason.
“The debt ceiling, and the constant crisis it creates through repeated threats of government shutdown, is unnecessary and problematic to say the least,” Boyle said in a press release. “It’s no wonder that only a handful of countries around the world currently follow this disruptive, arbitrary and restrictive fiscal practice.”
President Trump, Vice President Mike Pence, and Senate Minority Leader Chuck Schumer (D-NY) have all expressed at least some level of interesttowards the idea.
“When you receive your credit card statement at the end of the month, you can’t decide ‘I’ll pay this, but won’t pay that,’” Boyle added. “Our current process of ‘governing by deadline’ and playing chicken with the debt ceiling is essentially doing just that — and risking the full faith and credit of the United States. This is reckless and irresponsible.”
What opponents say
Opponents haven’t spoken up so much about Boyle’s bill specifically, because it’s failed to gain much traction in Congress.
But many Republicans believe that the current debt ceiling practice is an effective means of reining in government expenditures. “I think there’s a legitimate role for the power of the purse of the Article 1 powers, and that’s something we defend here in Congress,” said Speaker of the House Paul Ryan (R-WI1).
Even some Democrats agree that it’s helpful to have a constant process of continually re-evaluating national spending priorities and levels.
Plus some note that the paranoia about the debt ceiling has been just that: paranoia. Despite some close calls, Congress has never once actually failed to extend the debt ceiling.
For the first time, this decade has produced several instances where Congress came shockingly close to failing to raise the national debt ceiling.
In 2011 Congress came a mere 48 hours away from missing the deadline, until a compromise deal called the Budget Control Act of 2011 passed at the last minute. This produced the “sequester” cuts to both military and other categories of federal spending, cuts which are still in place today. It also caused a downgrading of the nation’s credit rating, the first time that had ever happened.
One requirement of that 2011 compromise law was that a constitutional amendment mandating a balanced budget had to receive a vote on by the end of the year. If it passed, it would have essentially illegalized deficits or an increase of the national debt (except in wartime), rendering the debt ceiling irrelevant.
The balanced budget amendment vote actually received a large margin of support, 261–165 in the House, but that 60 percent fell short of the 66% (two-thirds) required.
Although the deficit declined every year between 2009 and 2015, as a percentage of the economy, the government hasn’t run an actual surplus since 2001. Until that happens again, the national debt keeps growing, requiring raises in the debt ceiling.
Odds of Passage?
Usually we include a section called Odds of Passage. However, because of the extremely unusual and extensive conflicting factors at play, this time we won’t. Those factors include a tentative agreement between White House and Democratic leaders, public exhaustion with debt ceiling crises this decade, and many conservatives including the House Freedom Caucus wishing to preserve the debt ceiling as a negotiating tool despite the apparent contradictions from the Republican president.