Appearing on Fox News host Neil Cavuto’s show yesterday to push his debt ceiling contingency plan, Sen. Ron Johnson (R-WI) seemed to welcome the possibility of deploying it, despite the fact that experts say not raising the debt limit could have disastrous consequences for the U.S. and global economies. Johnson dismissed the threat that rating agencies would lower their assessments of American debt if Congress fails to act, saying there’s a “real possibility” that the limit won’t be raised:
JOHNSON: I’m going to do everything I possibly can to make sure we don’t increase the debt ceiling until we actually fix the problem. So, that’s what I’ve been trying to work on is to say, we don’t have to fear not increasing the debt ceiling. It’s been irresponsible of this administration to not lay in the contingency plan in case we don’t increase that debt ceiling, because that’s a real possibility.
Johnson’s acknowledgement that the GOP may shoot the hostage is fairly startling, considering that Senate Majority Leader Mitch McConnell (R-KY), House Speaker John Boehner (R-OH), and other GOP leaders have all publicly insisted that the debt limit must be raised.
Johnson’s doomsday plan would prioritize interest payments on the debt and limit government spending to tax revenue coming in. The result is a massive cut to outlays literally overnight that would force the government to default on its obligations to federal workers, Social Security recipients, and others. Johnson and others on the right, including House Budget Committee Chairman Paul Ryan (R-WI), have dismissed the significance of a short-term default like this. But earlier this month, the credit rating agency Fitch warned that even some missed payments — exactly what Johnson’s plan calls for — would do real damage to the U.S. creditworthiness.