This is insane. Republicans who pretend to be pro-business but are actually apathetic are stealing the entire faith and credit of U.S. government. Robert Wolf, former chief executive at UBS Americas, and Obama's economic advisor, stated in an interview. This should not be the polarizing issue everyone is discussing and working on. If you want to fight for policy infrastructure, climate action, and healthcare benefits, then that is what you should do. However, I don't think you want to fight over the debt limit.
The White House's current, more aggressive position in the debt ceiling standoff represents a concession that their previous approach to the issue has not produced the desired results. In the hope that Wall Street and the business community would pressure at least 10 Senate Republicans to vote for lifting or suspending the debt ceiling, the administration had refused to deal with the issue using earlier legislative tools. After it became unlikely, Democrats attempted to pass the legislation by majority vote, but were met with resistance from Republicans. With the default deadline less than two weeks away there is little public or private optimism within the administration that the resolution will not be a nail-biter.
Although they acknowledged that they would prefer to use other avenues, White House officials Monday said they don't rule out raising the debt limit through reconciliation, which McConnell has been encouraging them to do for months. They are concerned that Republicans who voted to increase the debt limit by trillions in Trump's favor, could use this opportunity to waste precious Senate time. Biden described the path as complicated, risky and cumbersome.
He said, "If you don't want to save the country," he said Monday. This was after officials from the administration had strategically placed several key officials to emphasize the urgency, but to no avail.
Both the White House and Republican leaders said that there is no negotiation over the limit. There are only a few possible resolutions. Republicans might cave. Democrats could change the Senate rules to allow for a debt ceiling increase with only 50 votes. If Democrats decide that reconciliation is necessary to pass the debt ceiling hike, which many believe will be the case, Republicans might agree to lower the number of time-consuming barriers that slow down the process.
McConnell, despite his statements that the debt ceiling should be and will be raised, has made it clear that he does not want to help Biden and insists Democrats must do it all alone, after giving them almost three months notice.
Wolf said that Wall Street and the industry have not acted with Republicans despite their pressure. This is partly because the business leaders believe there will be a solution. Wolf is troubled by more than the white-hot rhetoric and lackluster bipartisanship on past debt. He is also concerned about Janet Yellen's lack of deference to him. She has warned repeatedly that the country may be in an accidental default if it isn't addressed soon.
Wolf stated that the idea that they ignore her calls is completely ludicrous. Wolf called Yellen experienced and levelheaded, and not someone who would cry wolf.
Biden and Yellen joined Yellen Monday to discuss the consequences of a default at the kitchen table. He said that sending the economy over a cliff risks jobs, retirement savings, Social Security benefits and salaries for service personnel, as well as benefits for veterans and beneficiaries.
Although they are not making any progress with Republicans, the administration and its close allies feel that they're making an impact with the public. Democratic Party officials cited a long list editorials and opinion pieces coming from key swing states as evidence that Republicans are to blame for the impasse. They believe that the fight, long considered a Beltway obsession with dire economic consequences is now being felt by ordinary Americans.
Two bets are being made by Republicans. First, the public will not be able distinguish between traditional debt and obscure rules surrounding the debt ceiling. The second is that voters will be able to blame the party in charge if the economy suffers.
These prospects make progressives wish the White House would think creatively and go further than it currently does. Josh Bivens is the director of research at Economic Policy Institute. This left-leaning thinktank said that he prefers a route suggested by Democrats to put off the debt limit for years to come.
He said that it was absurd to raise it and then tell people, "Yeah, we abolished it and are now like every other rich country on Earth in that we were not affected by this dumb law anymore."
Bivens stated that he understood that Biden, the White House, and Republicans are trying to take some political hits for raising the debt limit. He warned that the White House should be prepared to neutralize the threat unilaterally. This could mean minting platinum coins, or continuing to issue debt while daring anyone to stop them. Officials at the White House have stated that they will not or cannot choose between these options.
Bivens concluded that everyone is just trying to avoid a political hit. I don't think people care about the debt limit. They care about their lives and the economy.
