WaPo: Here's how the White House will cave to McCarthy

AP Photo/Andrew Harnik

Get ready for The Big Spin Cycle that will convince the media to cover Joe Biden’s retreat as a victory. Once the White House invited Kevin McCarthy to discuss the debt-ceiling bill he surprisingly got through the House, the “we don’t negotiate” game was over. Joe Biden tried talking tough after that news broke, but no one — and I mean no one — believed Biden invited McCarthy just to discuss the weather.

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Late last night, the Washington Post offered a look at the retreat strategy that the White House hopes will convince the media to cover a debt-limit deal as a Biden win:

President Biden has been adamant that he will not acquiesce to Republicans’ proposed spending cuts to secure their support to raise the debt limit, arguing that he cannot reward the GOP for taking the U.S. economy hostage. But Speaker Kevin McCarthy (R-Calif.) has been equally adamant that the House won’t lift the debt limit without securing cuts. One way out of this logjam — widely discussed on both ends of Pennsylvania Avenue — would be reaching an agreement that each party then defines differently, with Biden claiming he gave up nothing for the debt limit hike and McCarthy claiming he won concessions on spending.

The potential for this “two-track” negotiation is coming into greater focus after the White House announced Monday that Biden had invited McCarthy and the other three top congressional leaders for a sit-down discussion next week.

Another word for “two track,” in this instance, would be “double-talk.” Biden insisted that he would not negotiate at all on the debt ceiling nor allow conditions to be attached to its increase. McCarthy insisted that he wouldn’t allow for a debt ceiling increase without spending reductions. If the debt ceiling comes with spending reductions, which side won the argument — regardless of how the pieces come together? Especially since the spending cuts come from Biden’s own earlier legislative victories?

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The Post quotes a Biden ally to make that pitch:

“Biden could totally say, ‘We made a deal on spending, which we knew we were going to have to do,’ about the same deal where McCarthy also says, ‘We got them to give up this, that and the other thing for the debt ceiling,’” said Dean Baker, a liberal economist and White House ally. “They could say both things that are completely opposite and hope they can sell it to their base.”

That’s certainly one way to put it. Another, more honest assessment would be that Biden got forced into cutting his own spending programs because McCarthy caught Biden and Chuck Schumer with their pants down when the House passed the bill that matched spending cuts with the debt-ceiling hike. Democrats underestimated McCarthy and thought that he’d be forced to turn to Democrats on the debt ceiling.

They expected to use Yellen’s warning as a way to paint McCarthy as a radical obstructionist. When he got his bill through the House, McCarthy instead flipped the table and made Biden and Schumer the obstructionists. The House already did the responsible step of passing a debt-ceiling hike, McCarthy could and did argue, and it was up to the Senate and White House to deal with it on McCarthy’s terms. And since Biden has publicly insisted that “terms” wouldn’t enter into this issue, just the negotiations themselves are an embarrassing retreat.

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Besides, McCarthy won’t need to “sell” spending cuts to his base. Spending cuts sell themselves as a win. Biden, Baker, and Schumer will have to sell spending cuts to Democrats’ big programs as a victory, and … well, good luck with that. This embarrassing exposé from the Post suggests that the White House won’t even be able to sell it as a win to their allies in the media, although Lord knows most media outlets will be happy to pass that spin along.

Addendum: I put Josh Barro’s point into the Headlines last night, but I’ll include it here too. Yes, the debt ceiling is a stupid redundancy, but the claim that it shouldn’t be debated is even more stupid:

It’s well covered that the debt limit is redundant as a policy matter: Congress limits the amount of federal spending through laws creating mandatory spending programs and laws appropriating funds, it sets tax policy through laws, and those laws govern how much money the government must borrow.1 As a political matter, we’re fighting over whether the need to raise the debt limit should be used as leverage to extract policy concessions. My main point today is that leverage exists independent of the debt limit: Republicans control one house of Congress, and bills to fund government operations next year can’t pass without their consent. They are free to tie demands to the passage of those bills — including demands about mandatory spending or other policies not directly addressed in appropriations bills.

So on one hand, the fight over the debt limit is very important: If the debt limit doesn’t get raised in time, we may face an economic crisis associated with a default on government bonds. On the other hand, the fight over the debt limit isn’t important at all: If it’s removed as a lever, Republicans still retain the ability to force Democrats to the table to cut spending. This redundancy is the reason that debt limit increases so often are tied to agreements over spending. As I’ve written repeatedly, it’s not true that “negotiating over the debt limit” was an aberration in 2011. It’s happened repeatedly since 1985; it just doesn’t stick out in memory because we’ve rarely gotten so close to default as we did in 2011, and most of those negotiations are just remembered as budget negotiations.

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Congress authorizes borrowing in its massive deficit-spending budgets every year, and that authority makes the debt ceiling redundant. But let’s not pretend that the debt ceiling is somehow sacrosanct from debate and negotiation either. If we want to eliminate the debt ceiling or tie it specifically to the annual budget, let’s see a reform plan to do that. Until then, it’s public policy, and that means all sides had better be prepared to negotiate and account for their policies.

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