The Debt Ceiling
Posted on December 10, 2009
The Debt Ceiling
One of the central paradoxes of life comes with debt. As any banker will tell you, the more debt you have, the more loans you can get. You just have to have a track record of paying your debts off, eventually.
That is why people still give Donald Trump money, even though he regularly declares bankruptcy when some of his outlandish ventures go belly up.
So, debt is not only a bad thing. It can also be a good thing.
Tell that to Democratic members of Congress, and you might get a different story.
When I worked for the Majority Whip in 1995, one of our first big tests was raising the debt ceiling, which means the amount of money that the US government can borrow without running afoul of the law.
Republicans campaigned hard on a balanced budget, and were in no mood to increase the amount of money we could borrow. But reality was reality, and without increasing the debt ceiling, social security checks wouldn’t go out.
Eventually, we discovered a parliamentary procedure called the Gephardt Rule, named after former Majority Leader Dick Gephardt.
Gephardt is now a well-respected lobbyist, but once was a serious candidate for President. He was kind of a big deal.
His lasting institutional legacy, though, is this parliamentary procedure that allows House members to avoid a clean vote on increasing the debt ceiling, having it spin off into legislation once the budget resolution conference report is adopted.
It is a clever procedure, fundamentally disingenuous to the voters, but a clever way to really stick it to the Senate.
The Senate doesn’t have a companion to the Gephardt Rule, and they usually have to confront the reality of the debt late in the year (usually during the Christmas holidays).
We ended up keeping the Gephardt Rule, once we discovered that Republicans didn’t really want to vote for an increased debt ceiling, and Democrats weren’t going to help us keep Social Security checks flowing to old people.
The key to the debt limit, for most political leaders, is to keep the vote hidden among other items. And this year is no different, as Senate Democrats have seemingly decided to add their debt ceiling increase to a defense appropriations bill. They know that their best chance of escaping the voter's wrath is to bury the debt in the war spending. Because the number is so large, the House will follow suit by approving the omnibus defense spending conference report.
Democrats will vote to increase the debt by 1.8 trillion dollars. That is a lot of money, and almost all of it is attributable to increased spending from the Obama Administration. They have obligated a trillion dollars for so-called stimulus spending (do you feel stimulated?). They have another trillion dollar health care spending plan that they are trying to ram through the process. They have continued to spend a lot of money on our two wars (spending I agree with, by the way). And they have their regular spending bills, which have spent more this year than any other year in history.
Mr. Obama and his team of big-spending Congressional Democrats have successfully put debt back in the national consciousness. For the first time in a generation, normal Americans are worried about the debt.
And that is what makes the Congressional vote to increase our debt ceiling more difficult than usual.
Every banker knows that a client who has a lot of debt can probably handle more debt. But try telling that to the American people, who are growing tired of the debt-increasing plans of the Obama Democrats.