The Debt Ceiling and False Equivalence

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The most difficult political stories for journalists to cover and pundits to analyze may not be 100 percent stories or 50 percent stories.

The 100 percent story is a clear fact (even if partisans sometimes deny it): Joe Biden won the 2020 election. The planet is warming. Crime and inflation are higher now than they were a few years ago.

The 50 percent story is one that allows both sides to speak as the only fair way to cover it because the issue involves an inevitable trade-off for society (although partisans sometimes suggest otherwise). Tax rates, abortion, border security and religion in schools are all eligible. The dispute is more about values ​​and priorities than underlying reality.

Some stories, however, do not fit into either category. These stories tend to involve disputed facts, and each side can point to some evidence for its argument – but not the same amount of evidence. In this third category, one side makes a more truth-based claim even though neither side has a monopoly. I think this story is 90 percent of the story.

The fight over the debt ceiling is the 90 percent story.

Almost no other country in the world has a debt ceiling. Elsewhere, politicians argue over how high to tax and spend while enacting budget legislation. Once the legislation is passed, the government will not need additional authority to borrow money to pay for the program.

Your household budget works the same way: You don’t decide whether to buy a car and then decide for yourself whether you should pay off a car loan. The decision is whether to buy a car in the first place. If you do, you’re paying off debt – or going bankrupt.

The US government uses a two-step process. After passing tax and spending policies, Congress must pass other laws authorizing the repayment of its obligations. This second law increased the limit on the amount of government debt, known as the debt ceiling. (Here’s an explanation.) Denmark is the only other country with a similar system, and Danish politicians increase the debt ceiling in advance, usually without revenge.

On Monday, Janet Yellen, the secretary of the Treasury, announced that the federal government will follow the debt limit for about a month, around June 1. If that happens before Congress raises the ceiling, the federal government could default. Defaulting could lead to global financial chaos because investors have traditionally viewed American debt as a safe investment in a risky world.

The debt ceiling is not a 100 percent story because both parties have used its existence as a threat, intended to win policy concessions, while the other party controls the White House. As a senator, Biden chose not to raise the ceiling several times, and Senator Barack Obama chose not to do so in 2006.

But the debt ceiling is not the 50 percent story, because the two sides are very different. Democrats have never allowed the ceiling to get close to being breached; when the Republican became president, the Democrats agreed to increase the limit well in advance. Here’s what happened without much drama in 2019, when Donald Trump became president and Democrats controlled the House.

“I can’t imagine anyone thinking of using the debt ceiling as a bargaining chip,” Trump said.

When Obama became president in 2011, by contrast, Republicans came so close to allowing default that financial markets tightened and the economy and job market suffered. Today, Republicans are calling for sweeping policy changes despite only controlling the House, while Democrats control the White House and the Senate. Republicans say they will raise the debt ceiling only if Biden agrees to big cuts in federal spending that would undo some climate policies and make it easier for the wealthy to avoid paying taxes.

This asymmetry makes the debt ceiling the 90 percent story. And it puts the Biden administration in a difficult position.

Endgame remains uncertain. A few dozen House Republicans on the right seem willing to allow default if they don’t get their way. Biden and his aides, believe that pursuing Republican demands will cause unrest when the country reaches the debt limit, possibly next year.

But White House aides are debating whether the Constitution authorizes the president to act even if Congress does not, The Times reported yesterday, while House Democrats have drawn up long-term plans to force a vote on a simple increase in the debt limit. won the support of Republican moderates.

“The overwhelming feeling on Capitol Hill is that this negotiation may be different from past negotiations,” Catie Edmondson, who covers Capitol Hill for The Times, told me yesterday. “Democrats learned from 2011 that this type of offer only encourages the Republicans to play the game with the debt ceiling, and the Republican majority now consists of the legislature far more willing to dig and fight, regardless of the consequences. This is a dangerous combination.

Go behind the scenes: On “The Daily,” Catie talks about McCarthy’s strategy.

Most expensive players in the NBA: Joel Embiid, 29, was born in Cameroon and didn’t play basketball until he was 16. Now he’s the league’s MVP

Lakers: LeBron James & co. defeated the defending champions, the Warriors, in Game 1 of their Western Conference semifinal series.

Brooks bounced: Memphis told Grizzlies guard Dillon Brooks that he will not return to the team next season.

The NHL Kraken continues to crack: Seattle’s overtime victory at Dallas continued the franchise’s two-year run through postseason hockey.

The nominations for the Tony Awards, which were announced yesterday, are in the spotlight for potential winners. This year’s competition for best new music is close, critics say.

“Some Like Heat“A Jazz Age show about two witnesses of the mob hit, scored the most nominations with 13. It will face competition from “& Juliet,” which combines pop songs with an alternative take on Shakespeare’s star-crossed lovers; “New York, New York,” a dance performance against the backdrop of war; and”Arrested,” a comedy about a community corn crisis. A critical favorite is “Kimberly Akimbo,” about a high school student with a life-altering genetic condition.

Here are all the nominations.

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