U.S. President Joe Biden and Vice President Kamala Harris meet with House Speaker Kevin McCarthy and congressional leaders Chuck Schumer, Mitch McConnell and Hakeem Jeffries in the Oval Office of the White House on Tuesday to discuss the debt ceiling. Photo by Yuri Gripas/UPI | License Photo
Not for the first time, both ends of Pennsylvania Avenue are playing political Russian roulette. Except this time, all six chambers are loaded with bullets. It will be America that is the victim.
The issue is the debt ceiling. And, in fairness, if American politics and governance were rational, the collision between what should be two valid and competing arguments would be averted. On the one hand, the White House is correct that the debt ceiling must be raised. On the other, Republican members of Congress are correct that spending is out of control and the growing national debt is unsustainable.
The click of the gun's hammer being cocked is deafening. Soon, if the stalemate persists, the trigger will be pulled and the United States will default. Some argue that this is a Y2K problem. The outcome will be de minimaI.
Reality is different. How, for example, will the federal government pay its employees, some of whom actually work on Capitol Hill, and 1.3 million Americans serving on active duty to defend the nation? Social Security and Medicare checks will not be sent. And companies providing goods and services for the government will be self-financing.
Who knows what the impact will be on stock and financial markets, as well as on international trade. These are among the most obvious of affected institutions. Oh, and by the way, who will be guarding the borders, with many tens of thousands of asylum seekers camped out on the southern side of the Rio Grande?
This game of chicken can also be portrayed as two driverless cars headed directly at each other, if roulette is not your game. President Joe Biden and House Speaker Kevin McCarthy, R-Calif., are exercising give-no-inch positions at a time when the nation is at grave financial risk. The bet is that one side or the other will come to their senses. But suppose neither flinches and the hammer strikes one of the loaded chambers?
The expiration of the debt ceiling, raised 78 times since 1960, 49 by Republicans and 29 by Democrats, was surely not a surprise, as were the attacks on Pearl Harbor and Sept. 11. Still, there are only a few weeks to resolve this looming crisis. The president attending the G-7 conference in Hiroshima, Japan, from Friday through Sunday could be a further complication if he were needed in the negotiations. Common sense could prevail.
Yet, the unprecedented state of political divisions in the United States, arguably broader and in some cases as deep as the cause of the Civil War, could override good judgment and rationality. Donald Trump made this case in last week's CNN-sponsored New Hampshire pep rally, asserting better to default now than later. Some Republicans agree with him. Does one also hear the sound of lemmings racing off a cliff?
America has a colossal spending problem that will only worsen. America's population is aging and with COVID-19 over, life expectancies will rise. Fewer young Americans will be required to support more older, retired Americans. And the uncontrolled, built-in costs of virtually all government spending programs will exacerbate this condition.
Unlike parliamentary governments, ours cannot resign en masse to form a new one. Some argue that selecting 537 names randomly from any telephone book would produce a more effective government than the one we elect. And given that making spending cuts and raising taxes to balance the budget as the 2024 elections approach is a fantasy, what is to be done?
Actually, one answer is present. The most effective and least painful way of resolving the debt crisis is to enhance productivity. That, in turn, increases GDP that increases government revenues.
Over the past two years, Congress has appropriated about $5 trillion through the Build Back Better; Inflation Reduction; and Chips and Science acts. Much of this is designed to align American infrastructure, broadly defined, with the 21st century. A National Infrastructure Investment Bank could be funded with public and private money for that purpose.
Since $5 trillion or so is in the piggy bank, why cannot both ends of Pennsylvania Avenue agree on where and how it will be spent, so that the nation gets the biggest bang for all these bucks? Yes, cuts need to be made in the budget. However, a growing GDP is a better solution.
This will require a cease-fire in political animosity and hostility. Since we cannot throw all the bums out until November 2024, this may be the least worst solution.
Harlan Ullman is senior adviser at Washington's Atlantic Council, the prime author of "shock and awe" and author of "The Fifth Horseman and the New MAD: How Massive Attacks of Disruption Became the Looming Existential Danger to a Divided Nation and the World at Large." Follow him @harlankullman. The views and opinions expressed in this commentary are solely those of the author.