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US hits debt ceiling, prompting Treasury to take extraordinary measures (cnn.com)
20 points by zinekeller on Jan 19, 2023 | hide | past | favorite | 53 comments


A few weeks ago, a group of far right Republicans extracted concessions out of McCarthy. I imagine a group of Democrats could have helped vote McCarthy in with a much milder set of concessions.

(Heck, a small group of Democrats could still join McCarthy to survive a re-vote and change the rules back.)

My guess is that the Democrats like it when the Republicans look bad even if they eventual outcome is a loss for the country as a whole.


I mean for the vast majority of the votes the Democrats had the lead [1]. It seems much easier for 6 Republicans to ask for some pork projects or other concessions instead of 15 Democrats.

[1]: https://en.wikipedia.org/wiki/2023_Speaker_of_the_United_Sta...


Huh, interesting. I stand corrected.


> I imagine a group of Democrats could have helped vote McCarthy in with a much milder set of concessions.

A small group of Republicans could have voted for Hakeem Jeffries and locked the crazies out completely. Did you have a cognizant point to make?


> I imagine a group of Democrats could have helped vote McCarthy in with a much milder set of concessions.

The problem with that is, there would be no way to hold McCarthy accountable to those promises. Republicans do not negotiate in good faith, and any promises about the debt ceiling, committee assignments, and the like wouldn't be worth the air they were spoken with.


Ah, so it’s the Democrats fault that the Republican fiasco rolls on?


In a reasonable political system, that us what would have happened. Not necessarily with McCarthy, but some type of coalition government with bipartisan support. Frankly, if they wanted to and could get near unanimous agreement internally, the Democrats probably could have had their pick of Republican as speaker.

Several aspects made this difficult to do though:

1) Given our political climate, no one wants to vote for the other party to be speaker. It would be political suicide in a primary

2) For as long as it felt like the vote took, the Democrats did not have enough time to whip support for anyone other than McCarthy.

3) McCarthy would be taking a very big risk in forming an agreement with Democrats here

4) An individual politician crossing party lines without support of their party leadership would be political suicide. Not just due to voter perception, but because of how important institutional support is.

5) As you say, the appearance of Republican dusruption is goid for the Democrats.

With all of that, I'm not convinced that the concessions are that big of a deal. The core dynamic is that bipartisan agreement on high profile issues is a non starter, and the Republicans have a razor thin majority and several members willing to play hardball.


> In a reasonable political system, that us what would have happened. Not necessarily with McCarthy, but some type of coalition government with bipartisan support.

In a reasonable political system, the various factions would be separate parties, and coalition building would be between whole parties, not between factions within a party. The US has an electoral system which does not produce a reasonable political system.

(“Bipartisanship” was a side effect of partisan incoherence during the long 1930s-1990s realignment, but it's not really something one would expect except on tangential issues with parties that are strongly aligned along the main salient ideological divide.)


> 1) Given our political climate, no one wants to vote for the other party to be speaker. It would be political suicide in a primary

Well, I'm not positive of that since the primary would be a long ways away. Remember how bad of a look for Biden leaving Afghanistan was and how little anybody talks about it now?

And also sometimes politicians switch parties [1] so voting for the party you switched to sounds like a great way to drum up support.

> With all of that, I'm not convinced that the concessions are that big of a deal.

Afaik, the concessions are mostly just setting up ground-work so that the recipients can further their political career faster. Which technically is also good for the constituents as they should get more pork.

[1]: https://en.wikipedia.org/wiki/Jeff_Van_Drew


McCarthy never came to the Dems to strike a deal (publicly) and its clear to me why that would have been a very last resort. Being seen negotiating with the enemy probably would have lost him votes in his own party as one of the big reasons to get the House majority is to obtain committee seats and whatnot. Furthermore, you’re attempting to break the other party’s unity while your own party is the more tenuously held together one. For the Democrats, they’re the minority in the House. Even if the loss wasn’t as big as many expected, they still lost. They don’t have much political capital to expend to try to create a compromise, especially with a more polarized voting population.


Why didn’t a smaller group of Republicans vote for a Dem?


Why should they have helped McCarthy? He's one of many Republicans who bent the knee to Trump and the scourge of the "alt-right", and he reaped what he sowed.

It's not like the Republican party was trying to correct itself by going with a staunchly anti-Trump country-over-party moderate.

One party is clearly taken over by lunatics, while the other maintains a much more moderate posture, yet you blame the one attempting to stay sane over the one that is making conspiracy theories part of its core platform.


I hate to say it, but I see this attitude as a big part of the overall problem.

Both parties have representatives who focus on policies that sound good with no useful thought or understanding of their actual effects. Both parties represent their opposites as lunatics, horrible people, other otherwise as people to be detested, with little allowance for the fact that the actual function of Congress is to pass hopefully beneficial bills — the mindsets or moral qualities of those who vote for the bills is ultimately not as important.

Left-leaning people do plenty of things that are easy for right-leaning people to point at as examples of lunacy. For example, look at almost any article about “DEI” or inclusive terminology or anything involving words like “Latinx”. Regardless of the actual merits of these things or the intentions of those who encourage them, they sound bad to many people with right-leaning hats on, and they’re very, very easy to make fun of.


Seeing inclusive terminology as a punchline, yes, I can see that. But a sign of left-wing lunacy? This response has some whiff of "bothsidesism", drawing a perceived equivalence between the behaviors of each party. If you didn't mean it like that, I apologize for misunderstanding.

That being stated, there's an objective difference between one party promoting inclusive terminology while the other promotes forcing a 10-year-old girl to give birth after being impregnated by rape. I know that latter issue wasn't mentioned, nor is it a universally held policy for all Republicans, but neither is support for inclusive terminology, and I bring it up to demonstrate the contrast of some views. Take even the most far-left view of a Democrat in Congress and it's to, what, provide universal healthcare? UBI? For this reason, I agree with the previous poster that one side seems like they're at least thinking about making life better, while the other seems hell bent on making it miserable, and sometimes in the craziest ways.

To be honest, I find the inclusive terminology more annoying than helpful, and I was born, grew up, and live in the Bay Area, a few blocks from where the Black Panthers were founded, to give an idea of where I'm coming from. But I feel like -- and this is going to sound a little strange -- Republicans harping on that topic is like sushi in the 80s. Remember movies/media from back then where eating/enjoying sushi was a sign that one was an effeminate cosmopolitan, bourgeois, and all-around weird person? Now it's in supermarkets in rural Virginia (yes, I've seen it there). At some point it will stop being a punchline; it will melt into the background and nobody will think much about it anymore.


On the contrary I think your perspective represents a clear problem: you seem to think the spread of DEI and woke bs in certain segments of society can somehow be equated with a literal attempt to turn over the results of an election, a storming of the fucking capitol like we're some 3rd world country, QAnon, attempts--some successful, others less so--to make cruelty a major point of immigration policy, etc. Not to mention issues such as climate change.

There is no sense of morality in what you're saying. I have traditional values and would vote for a center right party over Dems, if we had one. But what we have are two parties very unequal in terms of morality and intellectual credentials.


Because he was politically weak and they had an opportunity to take advantage of that.

As it is the Democrats got nothing but optics out of the fiasco. Had they played their hand differently they might have gotten something more.

For what it is worth, I suspect there was some backroom dealling they were trying to do, but nothing came of it.


Yeah, I can see a good argument for it, I suppose.


> I imagine a group of Democrats could have helped vote McCarthy in with a much milder set of concessions.

Not enough to offset the support he would lose in his own party for making any concessions to Democrats. The Republican factions are Trump-backed ultra-MAGA extremists and the-Trump-backed-group-is-too-moderate ultra-extremists; neither is open to concessions to the “woke mob” of Democrats.


No, I think it's more like- you have to treat Republicans as true, pure psychopaths. They will promise anything that gets them what they want but when it comes time they will do whatever is in their best interests regardless of previous statements. And their base will reward them for doing it. You can't really make a deal with someone like that.


Far right is a pretty loaded term.

I’m actually really happy that they extracted terms from McCarthy. Everyone who spent time slamming these 20 Republicans should publicly apologize and write them a thank you card because they got more victories for their constituents than most politicians ever do. Here’s what they got:

- Jeffersonian Motion to vacate the chair. This allows a single person to make the motion to remove the speaker if he goes back on his word or policy agenda.

- A "Church" style committee: this allows us to look into the weaponization of orgs like the FBI against the American people.

- Term Limit Vote

- Single Subject Bills(that can't be loaded with irrelevant nonsense

- Texas Border Plan

- A budget that stops an increase in the debt ceiling and holds senate accountable.

- Ending emergency funding and all COVID mandates and funding.

- 72 Hours to read a bill.

These all sound like objectively good things regardless of your political orientation.


> - A "Church" style committee: this allows us to look into the weaponization of orgs like the FBI against the American people.

The purpose of that committee is to be a factory for clips to show on Fox News and Newsmax. I appreciate your optimism but it's unwarranted.


> The purpose of that committee is to be a factory for clips to show on Fox News and Newsmax. I appreciate your optimism but it's unwarranted.

The democrats got their clips for CNN, MSNBC, WP, etc with their sham of an investigation complete with a Hollywood director.

Now that there's over 14,000 hours of footage being released we'll have even more clips.


Democrats and Republicans can both suck. Pointing to Dems when Repubs are assholes doesn’t make Repubs any better. Being partisan doesn’t always mean a good thing.


I'm not arguing one is better than another. Just pointing out that there has been an ongoing investigation that was publicized and directed by a Hollywood director to drum up clips, news stories and support from their supporters and to pain their enemies in bad light.

Now that the pendulum has swing the other way the other side will get their chance to blow through millions and create their own circus for their supporters.

It's kinda amazing how they don't realize that the power they seize can and will be wielded by their enemy with absolutely no remorse.


This is false equivalence and irrelevant bothsideism.


Whataboutism, bothsideism. Same thing?


> Texas Border Plan

This thing?

https://arrington.house.gov/uploadedfiles/1.pdf

This is an “objectively good thing” the way the War on Drugs was an “objectively good thing”. I think most people can agree that drug use and illegal border crossing ought to be reduced. But this plan is all about enforcement and ignores the demand side.

Where’s the portion of the policy making it possible for would-be employers of migrant labor to economically and legally match up with those who want to provide that labor? Where’s the portion recognizing that migrants and their children are human beings and deserve to be treated with a degree of dignity even if the US doesn’t want them right now?

> Ending … COVID … funding

I would love to see funding for a better COVID vaccine (and flu vaccine and RSV vaccine, etc).


Crazy that you don’t realize how bad the border problem is. First we need to secure the border that should be priority number one bar none. Then maybe we can talk about how to reform immigration policy.


It’s way past time this went to court to sort out. Congress has issued spending instructions, tax instructions and bond issuing instructions. They don’t add up.

Which means the balancing figure should be left at the Federal Reserve.

It needs to go to court to decide whether the Federal Reserve has the power to say “no” to a Congress mandated payment or whether it just has to suck it up and pay it anyway.


Unfortunately Congress and only Congress has final budgetary spending authorization abilities via the Constitution.

There is little that can be done here while we are in a deadlocked political situation in this country.


Congress passed laws authorizing the spending. If they don't want that spending, they can pass new laws repealing it.

Also the same Constitution that grants Congress budgetary authority also provides that:

> The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned. But neither the United States nor any State shall assume or pay any debt or obligation incurred in aid of insurrection or rebellion against the United States, or any claim for the loss or emancipation of any slave; but all such debts, obligations and claims shall be held illegal and void.

The debt ceiling is unconstitutional as it would cause the Government to default on lawfully authorized debts, in contradiction to the 14th amendment.


I heard that Biden's counsel might actually try to file a case against the legislative branch (as an institution, not specific people) about the debt ceiling (instead of negotiating with Republicans), which would be popcorn time.


It's ok that congress has that authority, however it should be implied that when they grant spending authority that the treasury may raise money to pay for what Congress granted.


Money isn't raised. It just appears as a function of the way banks account for transactions. That's the key misunderstanding here. There are no silver coins, just a bunch of promises.


Why do you say the balancing should be left to the Federal Reserve? If we are going to have executive branch institutions rectify Congresses instructions by disregarding one of them what is your principled reason for saying its the Federal Reserve's responsibility to fix the shortfall by issuing more debt in violation of the law instead of say the IRS's responsibility to fix the shortfall by collecting more taxes in violation of the law?


It's not a principled reason. It is how bank accounting works.

If you put the numbers authorised by Congress into the accounting then the result will be a carried forward balancing amount on the face of the Federal Reserve balance sheet. Since the Fed is mandated by law to be agent of Treasury and to follow the Treasury Fiscal manual they have no legal right to say no. And even if there was a legal right then Congress setting an unbalanced budget repeals it under the doctrine of implied repeal.

The reason why you can't write checks with gay abandon is because the bank can say no, and if you sue for breach of contract the courts will back the bank. If the Fed tries that with Treasury the courts will back the Treasury.

IRS can collect no more taxes by law. The Treasury can issue no more bonds by law and the Treasury cannot avoid spending what it is required to spend by law.


The Treasury could simply mint some trillion dollar coins, that is actually something they are authorized by law to do.


It can mint coins with 1tn on the front.

Whether the Fed has to give them $1tn of bank deposits for that coin is a different matter.

Once you have an unbalanced budget of this type, then Treasury dollars become like Canadian dollars. They stop having a 1-to-1 relationship with Fed dollars.

Banks have the power of discount, and maintaining a discount between the Fed and the Treasury is how monetary policy is alleged to work.


> As part of the debt issuance suspension period, the agency will begin to sell existing investments and suspending reinvestments of the Civil Service Retirement and Disability Fund and the Postal Service Retiree Health Benefits Fund. Also, it will suspend the reinvestment of a government securities fund of the Federal Employees Retirement System Thrift Savings Plan.

ah! ye olde 'sell the motorcycle on craigslist' and 'cancel the cable subscription' technique!


> She said the measures would expire on June 5

Probably don't tell lawmakers they need to urgently act and also tell them they have 6 months.

White House also seems to have the wrong messaging here. Should really be talking about how Trump added 6.7T in 4 years which is the complete opposite of spending reductions; republicans (as a party) does not legitimately care about reducing the debt.


The most recent president to seriously control (and even eliminate!) the deficit was Clinton, who was a Democrat.

One can quite reasonably debate what the government deficit should be, but the idea that Democrats are big spenders and the Republicans are big savers is ludicrous.

The debt limit, of course, is terrible policy.


Politically speaking, one thing pisses me off the most.

> Trump added 6.7T in 4 years

That debt was "paid for with tax cuts". And a lot of Republicans still think that cutting taxes is the best way to reduce the debt. I can almost assure you that we're going to hear more about Laffer Curves and tax cuts to solve this debt issue as the debate moves on.

Its been over 20 years, maybe over 30 years now... of this crappy argument, pretending that tax cuts improve our financial situation.


Yeah funny thing about the Laffer Curve is that the optimal rate is actually rather high ~70%.

https://en.wikipedia.org/wiki/Laffer_curve


amluto (https://news.ycombinator.com/item?id=34442824) already made the good points and I have been pondering the same thing.

What if the Dems got their game theories wrong: they decided making the Repubs look disjointed and in disarray was a better outcome than just voting McCarthy in without all the concessions. My best guess was they were really hoping to get a few defections to get Hakeem Jeffries. But what will be the consequences of the concessions and new rules?

Also one thing I still don't understand is, can anyone call the snap vote to oust the speaker? Or does that rule only allow Republicans to call that vote?


Repubs could have gotten their game theory wrong. It’s likely both sides are doing the wrong thing because that’s what both sides and the status quo always do.


only those of the majority party can is how the rule goes.


Step 1) Stop writing blank checks for dumb crap.

A certain political party in the US has had unchecked power and lead us down this path.


Not sure which political party you mean, given they've traded power multiple times over the course of the past 35 years.


Our veterans are "dumb crap" now? When I was growing up, that kind of talk would get a hippie's face smashed in. Wild times.


I think you're attacking a scarecrow. There are plenty of dumb things the fed government incinerates money on.

Caring for the people that _it itself_ put in harms way is not one of them.


However, they do represent a significant fraction of the government's budget and they are directly impacted by government shutdowns. That Republicans continue to play childish games regardless of their impact on veterans is shameful.


I believe Trump mentioned 911 conspiracies a couple times and Republican voters approved of it. There are no mores anymore.


You mean both parties




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