“You can compromise without violating your principles, but it is nearly impossible to compromise when you turn principles into ideology.”
Jamie Dimon
Speaker McCarthy and President Biden are embroiled in a risky game of political chicken over increasing nation’s debt ceiling, necessary to cover spending obligations previously-authorized by Congress.
McCarthy is being held hostage by his party’s hardline fiscal ideologues, justifiably worried any deal he cuts with the president will risk his Speakership.
Biden has been unwilling to discuss any spending cuts tied to a debt ceiling increase. His possible “nuclear option” of unilaterally invoking Section 4 of the Fourteenth Amendment would likely be challenged in court, delaying any potential implementation well-beyond the time the government runs out of money to pay its bills.
Whether our elected representatives like it or not, the only realistic way to materially reduce and ultimately eliminate projected deficits and eventually begin retiring the nation’s debt will require both reining in federal spending (vehemently opposed by Democrats) while concurrently increasing revenues, including targeted tax increases (a non-starter for Republicans).
Put in perspective, the recently-updated fiscal-2023 federal budget proposes spending $6.2 trillion, $1.4 trillion more than projected revenues. Thus, it would take a minimum of 8-10 years to retire the current national debt even if all federal spending was curtailed.
A failure to take responsible and timely action could result in a catastrophe for our economy, world financial markets, the strength of the dollar and investor confidence in the “full faith and credit” of U.S. government debt.
Perhaps President Biden should propose agreeing to certain spending cuts which do not harm our nation’s most economically vulnerable and appeal to House Republicans to agree to tax increases targeting other than lower and middle income Americans as part of an increased debt ceiling package. Republicans could agree to such a compromise or risk blame for the consequences.
Politicians more concerned with short-term political implications, party loyalty or the 2024 elections than with their country’s and its citizen’s well-being need to reflect on Colin Powell’s admonition, “But just as they did in Philadelphia when they were writing the constitution, sooner or later, you’ve got to compromise. You’ve got to start making the compromises that arrive at a consensus and move the country forward.”
