The nation is now one week away from hitting the Aug. 2 debt limit deadline. With Republicans refusing to compromise on any potential deal to raise the debt ceiling, the risk of the government defaulting on some of its obligations is currently greater than 50 percent, according to CNN commentator David Gergen.
ThinkProgress attended a Politico breakfast this morning with Reps. Mick Mulvaney (R-SC) and Kevin Brady (R-TX), as well as Sens. Bob Casey (D-PA) and Jeanne Shaheen (D-NH), and the debt ceiling took center stage. Casey and Shaheen spent the better part of the panel all but begging their Republican colleagues to compromise on anything in order to stave off default. Brady and Mulvaney brushed off their concerns; the latter insisted that the House’s radical “cut, cap, and balance” plan actually was a compromise.
ThinkProgress spoke with Mulvaney following the breakfast to get his further thoughts about a possible default. We asked the South Carolina congressman which would be worse for the country’s long-term fiscal health: increasing government revenue or defaulting on our debt? Mulvaney said that a default would actually be preferable because raising the debt ceiling without addressing the “underlying fundamentals” would make “things worse.” Brushing aside the fact that increased government revenue could pay down our national debt, Mulvaney argued that just increasing the debt ceiling would cause more harm than a default. “If we do a clean debt ceiling, that could be the worst thing we can do,” he said:
KEYES: In terms of the debt ceiling, there’s a lot of talk about possibly defaulting in a couple weeks, but obviously Republicans are worried about long-term fiscal health in terms of the effects of raising revenue. Which do you think would end up being worse for the country, if we were to go through a short-term default or if we were to have long-term revenue increases?
MULVANEY: I think the worst thing for the country is to not fix what got us here in the first place. That’s why you see us fighting so hard on this issue, to not have a clean debt ceiling. I think ratings agencies told me the same thing. If we simply raise the debt ceiling but don’t address the underlying fundamentals, then we’re making things worse.
KEYES: So that might end up being even worse than a default?
MULVANEY: I think so. If we do a clean debt ceiling, that could be the worst thing we can do.
Unfortunately, Mulvaney is not the only member of the Republican caucus downplaying the consequences of a default. Rep. Devin Nunes (R-CA) called for the nation to default on our debt obligations because “it could benefit us to go through a period of crisis.” Rep. Ron Paul (R-TX) agreed that default could be a “positive thing” because it will show we’re “serious.” Even House Budget Chairman Paul Ryan (R-WI), considered by many in Washington to be the “serious” conservative economic voice, advocated a short-term default.
Now, with a week to go before an economic collapse potentially worse than the Great Recession, Republicans like Mulvaney are refusing to prevent default because they views it as a preferable policy outcome. If House Republicans are able to prevent a debt ceiling increase by Aug. 2, the question remains: how long until they take up Rep. Steve King’s call to impeach President Obama?