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“To me it is madness that Republicans who speak as if they are so pro-business laugh at all the faith and credit of the US government,” said Robert Wolf, former managing director of UBS Americas. and Obama’s economic adviser, in a statement. maintenance. “It shouldn’t be the polarizing problem everyone is talking about and working on. You want to fight for politics – infrastructure and climate action and health care delivery – so lead that fight. But I don’t think you want to fight for the debt ceiling.
The White House’s new, more combative debt ceiling stance is somewhat of a concession that their earlier approach has not yielded the desired results. The administration had resisted dealing with the issue through previous legislative vehicles, in hopes that at least 10 Senate Republicans could come under pressure from business and Wall Street to vote to lift or suspend the debt ceiling to avoid a fiscal catastrophe. When it started to seem unlikely, Democrats tried to do it by majority, only to meet GOP resistance. Now, with the deadline for the default in less than two weeks, there is little private or public optimism within the administration that the resolution will be anything but a fingernail bite.
While acknowledging that they would much prefer to use other avenues, White House officials said on Monday that they do not rule out the possibility of raising the debt ceiling through the budget process known as reconciliation, which McConnell has been urging them to do for months. But they fear that Republicans, who themselves voted to raise the debt ceiling by trillions under Trump, will use the opportunity to burn precious Senate time, and Biden himself described this path as risky, complicated and cumbersome.
“If you don’t want to help save the country, step aside so as not to destroy it,” he said on Monday, entering the debate after administration officials strategically deployed several other key officials to convey the urgency. – all without measurable results.
The White House and Republican leaders both said there was no negotiation on the limit, leaving only a few potential resolutions. Republicans could give in. Democrats could change course and change Senate rules to pass a debt ceiling increase with just 50 votes. Or, if Democrats conclude that they will have to go through reconciliation, as many suspects will occur, Republicans might agree to remove fewer time-consuming hurdles to erase the process.
Although he has said the debt ceiling will – and should be – raised, McConnell has made it clear he does not want to help Biden, and insists Democrats must go it alone after giving them ” almost three months notice to do their job. . “
Wolf is not surprised that Wall Street and industry pressure have yet to budge with Republicans, he said, in part because the business titans themselves believe there will be. A resolution. But what troubled him beyond the heated rhetoric and lack of bipartisanship, even when it comes to dealing with past debt, is the lack of deference to Treasury Secretary Janet Yellen, who warned on several occasions that the country could suffer from an accidental defect if the limit is not addressed, and soon.
“The idea that they are ignoring his calls seems totally out of place,” Wolf said, calling Yellen experienced and poise and not someone who “calls wolf”.
On Monday, Biden joined Yellen to talk about the repercussions of a fault on the kitchen table: Sending the economy over a cliff, he said, endangers jobs and savings- retirement, social security benefits, military salaries and veterans benefits, among others.
Although they haven’t gone anywhere with the Republicans, administration officials and their close allies believe they are making a mark with the public. As evidence, Democratic Party officials pointed to a long list of editorials and opinion pieces from key swing states that blame Republicans for the standoff. Their belief is that a fight long seen as a Beltway obsession with dire consequences for the economy is now resonating with ordinary Americans.
The Republicans, meanwhile, make two bets themselves. The first is that the public will not be able to tell the difference between traditional debt and the obscure rules around the little understood debt ceiling. The second is that if the economy were to suffer, voters would blame the ruling party.
In the face of these prospects, some progressives want the White House to go much further – and think more creatively – than it is doing now. Josh Bivens, research director at the Economic Policy Institute, a left-wing think tank, said he had come to prefer a path specified by some Democrats that would push the debt limit years and years into the future. future.
“Just increase it to an absurd number,” he said, “and tell people,“ Yes, we did do away with it, and now we’re like every other rich nation on earth in that we are no longer afflicted by this stupid law. ‘”
Bivens has said he understands that Biden and the White House are take as strong a stance as possible that the Republicans suffer some of the political blow for raising the debt ceiling. But he warned the administration had better be prepared to unilaterally neutralize the threat, either by minting platinum coins or simply ignoring the limit and continuing to issue debts and challenge someone to stop them. . Both are options that White House officials have said they either won’t or can’t do.
“Ultimately I think everyone is anxious to avoid a political ‘hit’ of what isn’t even a love tap,” Bivens concluded. “I just don’t think people care about the debt limit. They care about the economy and how their life is going.
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