There’s less than one month to go until the federal government can’t fudge its debt limit anymore. Last week, the US Treasury announced it could run out of artificially-created “headroom” as soon as mid-February.
Ever since then, Republicans have been trying to turn the debt-limit headlines to their advantage. But if you look closely enough at these “wild goose chases”, they just show the growing distance between GOP rhetoric and the reality the rest of us are living in.
Their first idea? Wait things out. Then, once the Treasury runs out of headroom, just pick and choose which bills to pay. Or, in Republican-speak, “prioritize spending.” Their priorities, according to Reuters: pay the bondholders first; then pay Social Security and military salaries.
The first problem with this idea? The Treasury’s Inspector General has already told Congress that “prioritizing spending” is not – at this point in the crisis – actually possible.
Treasury noted that it makes more than 80 million payments per month, all of which have been authorized and appropriated by Congress… Treasury’s [accounting and computer] systems are designed to make each payment in the order it comes due.
In other words, the system simply isn’t set up to pay some bills and ignore others. How long would it take to completely restructure the federal government’s payment systems, in order to “prioritize” which bills get paid? Undoubtedly longer than the debt-limit “headroom” will last.
Second problem with this idea? How much money will it cost, to restructure the Treasury’s payment systems? Maybe some GOP campaign contributor would be the only IT vendor qualified to make those changes. But wouldn’t that money be better spent on other things?
Third problem with this idea? Stop and think about this, for a minute. Do we really want our country to stop paying its bills, even just some of its bills? Do we really want our country to fulfill its obligations to a select few, and ignore the rest? What would that say about America? (Maybe this is really the first problem with this idea. What are the Republicans thinking?)
So then, the Republicans went off to a retreat at the Kingsmill Resort in Virginia. (I’m guessing the GOP missed the irony in starting Martin Luther King Day weekend at a former slave plantation. Whatever happened to the Party of Abraham Lincoln?)
There, among three championship-caliber golf courses, GOP members announced their newest idea to deal with the debt limit crisis. The House GOP will concede to a three-month increase in the debt limit, but only if Congress passes a budget within those three months.
Ok, it’s starting to sound like Peter Pan’s “Neverland” here. Congress created the debt-limit crisis by approving spending but refusing to authorize the debt limit increase. Now the GOP wants to postpone that crisis by creating another crisis.
If nothing else, this really ought to draw attention to just how dysfunctional Congress has become in recent years. They’re answering one failure of Congress with another failure of Congress.
Yes, passing a budget is one of the Legislature’s most fundamental responsibilities. And yes, it has been years since Congress actually passed a federal budget. But isn’t it time to ask, why?
Think about the usual budget process (which is very similar to the way New Hampshire’s Legislature passes the state budget). Usually, the House passes a version of the budget. Then the Senate passes a version of the budget. Then a conference committee figures out a compromise between the two versions. Then the conference version goes back to the House and the Senate for an up-or-down vote.
Do you really think the House and Senate are going to be able to agree on a version of the budget in the next three months? Congress has been at a stalemate for years. The last Congress was the most unproductive Congress since they started keeping records. [Want to know what they did manage to agree on? 17% of the bills that were actually passed involved naming post offices or other public buildings].
But now, after a few days’ “retreat” at a plantation-turned-resort, House GOP members think they’re going to be able to turn this situation to their advantage.
No word yet on whether this latest Republican goose-chase is going to amount to anything more than just weekend headlines.
Wondering what’s the latest on that “headroom”?
If you remember, our federal government hit the debt limit on December 31st, and the US Treasury started taking “extraordinary measures” to keep the country from defaulting on its obligations.
Last week, the Treasury started starting paying government bills by using federal employee retirement funds to create “headroom” under the debt limit. The “G Fund” is a 401(k)-style retirement program with more than 3 million enrollees, including members of the military.
The law allowing retirement monies to be used to create “headroom” also promises to make members’ accounts “whole” after the crisis has passed. That’s what happened the last time there was a debt limit crisis, back in August 2011; and what happened after the debt-limit crises in 2006, 2004, 2003, and 2002. [Wait… am I just imagining there’s a correlation between debt-limit crises and the Bush-era tax cuts?]
But there’s no word on what happens if this particular debt-limit crisis isn’t solved.
And, no word on what happens if House Republicans decide they want to “reform” federal employees’ retirement benefits again.
And yes, those unaffordable-but-Congressionally-mandated US Postal Service payments are part of the “extraordinary measures” the Treasury is now taking to keep our government from defaulting on our debt.
“The Postal Service would still have positive net revenue today except for … a requirement that Congress imposed on it in 2006. No other public or private business in America faces this onerous requirement.” Read the letter signed by 82 Members of Congress here.
One last word about Paul Ryan: he must truly be a special guy. Ordinarily, he would have been replaced as House Budget Committee Chairman this year because of GOP “term limits”. It looks like at least three other GOP Committee Chairs will lose their positions, but Speaker Boehner has already decided to give Chairman Ryan a waiver and allow him to stay on. Read more here.