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Lawmakers are playing politics with the nation’s pocketbook and the clock is ticking.
The timeline and the tactics of government spending – past, present and future – will converge in a series of hard and soft deadlines and one massive partisan standoff over the next month, and the end result could be any combination of:
- A government shutdown, where certain public services are halted;
- A first-ever default of the US government in its debt, which could case what’s been described as “financial Armageddon;”
- A bipartisan bill to fix roads and bridges and for other things;
- A massive new round of spending to address climate change and inequality.
We just don’t know how this is going to play out.
Here are the key dates to watch:
- September 27: A self-imposed deadline passed for the House to act on a bipartisan infrastructure deal. The House started floor debate on the bill Monday, but House Speaker Nancy Pelosi has said a vote won’t happen until later in the week.
- September 30: Government funding expires at midnight, which could trigger a partial shutdown. Over the weekend, Pelosi said that the House would vote on the bipartisan infrastructure bill by this date, though that could slip if the bill does not have enough support to pass.
- Mid-October: The government reaches its borrowing limit, which could trigger a first-ever US default and a self-inflicted economic crisis if the US is unable to pay all its bills on time. It could delay federal payments, including Social Security checks and monthly child tax credit payments.
What must pass to keep the country running? Democrats have tied the debt limit and the must-pass spending together, hoping to shame Republicans into helping raise the debt limit.
Republicans are determined to carry through on Senate Minority Leader Mitch McConnell’s threat to make Democrats use partisan parliamentary tactics to both fund the government and raise the country’s ceiling.
What else are lawmakers trying to accomplish? There’s a bipartisan infrastructure bill to repair the nation’s roads and bridges and start other needed upgrades.
If Democrats can pass that bipartisan infrastructure bill, they might also be able to gain momentum to pass an even larger $3.5 trillion down payment on their effort to pivot the US economy toward renewable energy and address inequality through new spending programs. Over the weekend, Pelosi conceded to progressives that the House would not vote on the bipartisan infrastructure deal until Thursday, in hopes that Democrats could agree on a framework for the broader economic agenda bill.
Will Republicans allow votes on any of this? That’s TBD, but probably not.
McConnell is pushing Republicans in the Senate to stay unified and brushing off the private pleas of Treasury Secretary Janet Yellen that failing to raise the debt limit could send the US economy spiraling just as it recovers from the pandemic.
They’ll just allow the country to default? Unclear. For now, the coordinated blockade of GOP votes to pay the nation’s bills is a totally cynical but maybe brilliant chess move from a master tactician unburdened by sentimental attachment to the pieces, which in this case include the full faith and credit of the United States.
“Sen. McConnell rarely ever asks us to vote in a particular way, but on this one, he’s made his wishes known, and I don’t think he’s bluffing,” Sen. John Kennedy of Louisiana, told The Hill. Kennedy, whose state needs disaster aid that’s also in that government funding bill, is among the very few Republicans who have said they might break with their party and vote with Democrats. He said McConnell shows no sign of changing his mind. “He’s like that Missouri mule on this one, just sitting down in the mud and not budging, and I don’t think there will be 10 votes to pass the (funding bill.)”
Why are the Republicans in Congress doing this? There are plenty who simply oppose the spending. Some opposed it even when Republicans controlled Washington, although they all found a way to vote for budget busting temporary tax cuts. But we won’t have to deal with that for a few years.
Voters blamed Republicans for the last two government shutdowns and there’s never been a default. Back in 2013 and 2018, McConnell was the one wrangling for votes to keep things running and keep the bills paid.
Now, barely in the minority, he feels no responsibility to find any votes.
If Social Security can’t send out checks and the Treasury Department can’t sell bonds, that’s their fault. If Democrats can bring their fractious caucus together to keep things going, the journey will further divide them.
McConnell’s gamble is that Democrats will ultimately suck it up and do it, giving Republicans a unifying message of fiscal responsibility to move them beyond the Trump era. Better to label Democrats as profligate spenders, even if it means the US defaulting on its debt.
What about Democrats? Congressional Democrats are not blameless. They would rather use the partisan parliamentary tactics for other things and keep the toxic debt vote separate from their effort to pass a multi-trillion dollar down payment to remake the US economy in an effort to deal with climate change and inequality.
Instead, they have tied the debt ceiling to must-pass government funding, giving Republicans and their own members a take-it-or-leave-it choice.
Shutdowns and defaults are a new negotiating tactic
Like hurricanes and wildfires in a time of climate change, America’s cyclical government shutdown seasons are becoming more frequent and severe.
Lawmakers and the White House used to come to a head over government spending every 10 years or so. Now it’s every three or so.
What’s new in recent years? There’s a distressing new willingness to add the threat of defaulting on the national debt into the equation.
CNN’s Phil Mattingly reported last week that Yellen called McConnell to argue Republicans should at least allow a vote on the debt ceiling.
“The private call served to underscore a public reality: Washington is careening towards a debt ceiling debacle that would be catastrophic for Wall Street and Main Street alike,” Mattingly wrote.
“At stake is far more than political positioning or gamesmanship. Federal payment to millions, from government workers to Social Security and Medicaid recipients, would be halted. Military salaries would be frozen. A self-inflicted credit crisis would likely take hold, with increased borrowing costs rippling throughout sectors.”
Bottom line. The difference between Republicans and Democrats is that when Republicans controlled the entire government some Democrats helped them vote to keep the government open and raise the debt limit. Republicans feel no such duty.
That’s either a remarkable show of strength in party unity or an indictment of a wholly tribal view of government, depending on your perspective. But the winner-take-all outlook is apparent in everything from the GOP’s ability to push through Supreme Court justices to the concerted effort by many Republicans to overturn the election results. There is no American team spirit. There is only red and blue.
This story has been updated with additional developments.