After an eleventh-hour deal to avert the so-called fiscal cliff, Republicans are already looking forward to the next manufactured crisis: the debt ceiling fight. Though raising the debt ceiling was considered a routine order of business in the past, radical Republicans took the nation to the brink of credit default for the first time in history, refusing to raise the debt ceiling if Democrats did not agree to devastating spending cuts.
The US hit its debt limit again on New Year’s Eve 2012, and House Speaker John Boehner (R-OH) seems ready to gamble with US credit again. As the Wall Street Journal’s Stephen Moore reports, the Speaker may try to avoid a sustainable deal over the debt ceiling, instead increasing the limit little by little. This would result in another debt ceiling fight every month:
I ask Mr. Boehner if he will take the debt-ceiling talks to the brink — risking a government shutdown and debt downgrade from the credit agencies — given that it didn’t work in 2011 and President Obama has said he won’t bargain on the matter.
The debt bill is “one point of leverage,” Mr. Boehner says, but he also hedges, noting that it is “not the ultimate leverage.” He says that Republicans won’t back down from the so-called Boehner rule: that every dollar of raising the debt ceiling will require one dollar of spending cuts over the next 10 years. Rather than forcing a deal, the insistence may result in a series of monthly debt-ceiling increases.
Most Americans want to avoid another debt ceiling fight like the 2011 debacle, which led to an unprecedented downgrade of US credit, an all-time low approval rating for Congress, and cost taxpayers $18.9 billion. But Boehner is taking his cues from anti-tax activist Grover Norquist, who floated the idea of a monthly debt ceiling increase as a way to extort more spending cuts from Democrats. Norquist’s strict pledge to never raise taxes, which most Republicans have signed, was the main cause of the crisis in 2011. Other Republicans seem eager to replicate the experience, including newcomer Sen. Ted Cruz (R-TX), who encouraged his colleagues to aim for another government shutdown.
If Boehner takes Norquist’s advice and institutes a regular debt ceiling battle, he may fulfill his own warning in 2011, when he predicted a global “financial disaster” if the US did not raise the debt ceiling.