The debt-limit deal is disappointing, but Congress cannot risk economic calamity.
Republicans entered the debt-ceiling fight with grand ambitions. Last fall, they considered demanding reforms to Social Security and other entitlements as the price for raising the federal government’s debt limit in early 2023. When President Joe Biden predictably demagogued any changes to the Social Security and Medicare systems that overwhelmingly drive long-term deficits, Republicans downshifted to ambitious discretionary savings. Now, it appears that Republicans may settle for a small fraction of those discretionary spending savings, while expanding Supplemental Nutrition Assistance Program (SNAP) and significantly scaling back other priorities.
To be sure, those earlier ambitions were wildly unrealistic. Republicans enjoy only a razor-thin House majority, while Democrats control the Senate and White House. And the debt limit was a hostage most Republican lawmakers knew they could not shoot. The political reality is that most aggressive spending cut proposals are deeply unpopular even with Republican voters, and using the debt limit as a bargaining further accelerated the White House opposition to spending cuts.
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Brian M. Riedl is a senior fellow at the Manhattan Institute. Follow him on Twitter here.
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