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First off, America should not be here. Leaders in Congress, most notably House Speaker Kevin McCarthy, should not have taken the U.S. to the brink of a financial crisis to garner some spending cuts.
But brinkmanship and threats are sadly the nature of politics — and hence governing — today.
So, here we are: McCarthy and President Joe Biden have reached agreement on a deal that will avert a debt crisis — if the deal is approved by Congress. It should be.
The deal, reached late Saturday, would eliminate the federal debt ceiling for two years while keeping nondefense federal spending essentially flat for 2024 and limiting it to a 1 percent increase in 2025. Funding for veterans health care would be increased, work requirements would be instituted for some SNAP recipients and an increase in IRS funding would be pared back.
Although the agreement is far from something to cheer about, it is a necessary compromise to ensure that the federal government can continue to pay its bills. With the possibility of payments stopping next week, accepting this agreement is the responsible thing to do.
Sure, lawmakers can complain about it, but failure to accept this deal brings only bad outcomes, which will get worse by the day. The Treasury department has said it would run out of cash to pay the nation’s bills on June 5. If that is allowed to happen, economists have warned of a devastating cascade of events that would harm Americans and the global economy.
No one should want to see that happen.
So, some Democrats will have to reluctantly accept a cap on federal spending. and some Republicans will have to accept fewer cuts than many wanted. More importantly, both parties and the president should commit to a budget process that avoids these types of last-minute, high-stakes negotiations that carry a high cost of failure.
These types of last-minute deals to avoid debt defaults and government shutdowns have become too commonplace in Washington. There are no winners in these scenarios.
We understand that these can be politically valuable pressure points. Right now, Republicans’ main source of leverage in Washington is their slim control of the U.S. House of Representatives. But holding future federal spending hostage is not responsible governing.
Nor is ballooning the federal deficit without regard for how those bills will ultimately be made. Both parties are responsible in this regard. When they controlled Congress and the White House, Republicans cut taxes and increased spending, especially military spending, with little regard for the deficit. Democrats have expanded spending, often on social programs, when they have been in charge. And pandemic-era spending, approved by both parties, also helped further balloon the deficit.
As we wrote in January: “There of course need to be debate about federal spending, which is not sustainable at current levels. But refusing to raise the debt ceiling, which unleashes a cascade of damaging consequences, is not the responsible way to have this debate.”
Congress can end the current foolishness by passing the current debt ceiling deal. But, that is not the end of their work. It should launch a more thoughtful and deliberate debate about federal spending, taxation and borrowing. That debate should be guided by national priorities, not political priorities.
We can hope, can’t we?
