The Debt-Ceiling Problem, and How to Perpetuate It

As you probably noticed, we recently had another political crisis over the debt ceiling. When the government is spending more money than it takes in, it has to borrow the difference to pay the bills. By law, there's a limit to how much it can borrow. Since total government debt has been growing over time (except for a few years in the Clinton Administration) we periodically bump up against the limit and have to raise it to be able to pay the bills. The recent kerfuffle was over a Republican threat to refuse to raise the debt ceiling, thereby leaving us unable to pay the bills, unless various unrelated political demands were met.

The debt ceiling is in fact completely pointless, because it has no effect on what the government spends, only on whether it has enough cash on hand to pay the bills for what it spends. It's become the subject of two major political crises over the last two years. Can't we do something about it?

Now Eric Posner, a University of Chicago law professor, has written a column for Slate in which he suggests a solution to the debt ceiling problem: amend the Constitution.

[I]t would be easy enough to propose a constitutional amendment providing that “the president shall have the power to enforce Section 4 of the 14th Amendment.” If such a constitutional rule had been in place, President Obama could have announced that he would borrow as necessary to pay interest on the debt. 

As a solution to the problem, this is bizarre.  "Easy enough to propose," indeed. But as Posner notes, "Amending the Constitution is extremely difficult." You remember, the whole thing about two-thirds of both houses and three-quarters of state legislatures. The idea of getting two-thirds of both houses to agree on an amendment like this is mind-boggling.

And yet! Tea Party politicians regard the threat of a debt default as a short-term tactic ... not... as a policy goal that is desirable in itself.... Disagreements about the size of government can proceed apace, and conservatives still can prevail if they obtain majorities for cutting spending. Meanwhile, the financial health of the country is not put at risk. Once tempers cool and people move on to other issues, the amendment process—which will probably take many years—can begin.

Oh, you beautiful dreamer. This gives new meaning to the term "ivory tower." People have just lost their tempers! Once they cool down, they'll see their common interests. Then all conservatives need to do is get a majority for cutting spending. No sweat!

There is a much simpler way of dealing with the problem of recurring debt-ceiling crises: repeal the law. Simple majority in both houses. President's signature. Done.

Is that it? A good chunk of the American public seems to believe that the debt ceiling is in the Constitution. Not so. The debt ceiling was established in 1917. It was made obsolete in 1974, when Congress established a regular budget process to deal with spending. But it remained, I don't know why. Everyone knew it would have to be raised from time to time.

Posner is, of course, aware of all this. He even mentions repeal as one of a number of alternatives to a Constitutional amendment. But, he argues, the "problem with these fixes is that they can last only as long as a majority in Congress want [sic] them to last. A better solution is a constitutional amendment."

To see how strange this line of argument is, suppose the Republicans had won both houses of Congress and the Presidency in 2012. They're all set to repeal Obamacare, when.... Wait! Don't repeal Obamacare! If you do that, what happens if the Democrats come back? They could pass it all over again! Instead of repealing it, let's pass a Constitutional amendment against it.

How enthusiastic do you think the Republicans would be about that idea? They would argue that it wasn't at all easy to pass Obamacare in the first place, so Democrats are not just going to wave their hands and restore it. They would point out that such an approach would leave Obamacare in place for years. They would say that first they would repeal the law. Then they would entertain suggestions about a constitutional amendment.

The only sure results from Posner's approach are, first, that people would continue to believe, wrongly, that the debt ceiling is some sort of Constitutional requirement; and second, that nothing would change for a long time. We should do what you're supposed to do with a bad law: Repeal it.

Silent Dogs at the Shutdown

"Is there any point to which you would wish to draw my attention?”
“To the curious incident of the dog in the night-time.”
“The dog did nothing in the night-time.”
“That was the curious incident,” remarked Sherlock Holmes.
  --"Silver Blaze"

The late government shutdown  took a good whack at conventional wisdom in Washington. We've been hearing for some time that no matter how badly the Republican majority in the House behaves, nothing can be done about it. The Republicans, you see, have gerrymandered the congressional map so expertly that there is no chance they can be thrown out until after the next redistricting in 2020. Oops, maybe there is.

The conventional story never really hung together for me; I could never figure out how the arithmetic was supposed to work. When you gerrymander, you want to get as many seats as possible for a given number of voters on your side.  As Sam Wang explains it:

Gerrymandering is not hard. The core technique is to jam voters likely to favor your opponents into a few throwaway districts where the other side will win lopsided victories, a strategy known as “packing.” Arrange other boundaries to win close victories, “cracking” opposition groups into many districts.

That makes sense. It implies, though, that your side doesn't get safe seats--the other side does, while your side gets "close victories." There's a trade-off between maximizing the number of seats and maximizing the safety of each seat. As long as the are some moderate voters who might go either way, "close victories" are going to be nail-biters.

But are there any moderate voters left? Democrats need a swing of 18 seats to take control of the House. A quick check of the Cook Political Report (scroll down after you jump) reveals that 17 Republicans in the House were elected from districts that voted for Obama in 2012. Another dozen come from districts than went for Romney by two points or less. It doesn't take much of a shift away from Republicans to flip the House.

In the survey linked above, Public Policy Polling presumably was using this reasoning by polling in districts of the most vulnerable Republicans. They found that seventeen Republican representatives would lose to a "generic" (i.e., unnamed) Democrat, and another four trail the generic Democrat when voters are reminded that the representative voted for a government shutdown.

If you examine the PPP poll more closely, there are some odd things about it that might prevent one from putting a lot of faith in it. (For example, take a look at California 21, which according to Cook, Obama carried by 11 points.) But there's plenty of other evidence that things are not going well for Republicans. Both Gallup and the NBC/Wall Street Journal poll show that approval of the Republican Party is at its lowest point since they began asking the question. Granted, it's still a long way to the midterm elections. but if I were a Republican in an Obama district, I'd definitely be pretty nervous.

What is strange about the whole shutdown crisis was the dog that didn't bark: "moderate" Republicans. We heard quite a bit from the press about the "suicide caucus" of 80 Republicans who pushed Speaker Boehner into the shutdown. Those people probably are electorally invulnerable; the shameless Randy Neugebauer, for example, comes from from a Texas district where Romney got 74 percent of the votes in 2014.

But what about the representatives from districts where Obama won or nearly won? Clearly a lot of them are in jeopardy from the Republican collapse in popularity. Why didn't they protest publicly? A few have, such as Peter King (district: 52% for Obama). But even King voted for the shutdown, and later refused to sign a discharge petition that would have permitted a new vote. Why? Why didn't the self-preservation caucus speak up? Why didn't they just say no?

All I can imagine is that even representatives in fairly liberal districts face a threat from the Tea Party in the Republican primary. That leaves a lot of Republicans in a pretty tough place (call it the Straits of Mitt), having to survive both a primary challenge from the right and a general-election challenge from the left.

Curiously, one of the few pundits to pick up on the key role of the "moderates" is Paul Krugman. He concludes, however, "The biggest problem we as a nation face right now is not the extremism of Republican radicals, which is a given, but the cowardice of Republican non-extremists..." That's like saying the biggest problem we as a nation face is that pigs lack wings. The problem is not that "moderates" lack fearlessness, which is normally lacking in politicians; it's that they are poised between two fears, of the primary and the general election.

One would think that their professional colleagues in the House would have some sympathy for their plight, perhaps even some understanding of what's necessary to hold on to a majority, but the rookies seem completely clueless.“It’s pretty hard when he has a circle of 20 people that step up every day and say, ‘Can we surrender today, Mr. Speaker? Can we just go away? Can we make it easy?’” said [Kansas Republican Rep. Tim] Huelskamp.... “I would say the surrender caucus is the whiner caucus, and all they do is whine about the battle, as if they thought being elected to Washington was going to be an easy job.” Well, of course, the job's a lot easier when, like Huelskamp, you come from a district that voted for your Presidential candidate by 70%.

Finally, this episode, and the whole phenomenon of being "primaried," point once again to the need to get rid of the institution of party primaries. But that's a tale for another time.

Remarkable Victories in History

A sequel to this, of course.

I

Cruz: It was a ‘remarkable victory’ until Senate Republicans caved on the shutdown

Sen. Ted Cruz (R-TX) on Wednesday blasted members of his own party after he said that they wasted a “remarkable victory” by making a deal with Democrats to re-open the government and avert a default on U.S. debt by raising the nation’s credit limit....“Months ago, when the effort to defund Obamacare began, official Washington scoffed, they scoffed that the American people would rise up, they scoffed that the House of Representatives would do anything and they scoffed that the Senate would do anything.”

“We saw the House of Representatives take a courageous stand, listening to the American people, that everyone in official Washington just weeks earlier said would never happen,” he continued. “And that was a remarkable victory, to see the House engage in a profile in courage.”

“Unfortunately, the Senate chose not to follow the House...”

  

--The Raw Story

II

....

“With fire and sword the country round
Was wasted far and wide,
And many a childing mother then,
And new-born baby, died;
But things like that, you know, must be
At every famous victory.

“They say it was a shocking sight
After the field was won;
For many thousand bodies here
Lay rotting in the sun;
But things like that, you know, must be
After a famous victory.
...

“And everybody praised the Duke
Who this great fight did win.”
“But what good came of it at last?”
Quoth little Peterkin.
“Why, that I cannot tell,” said he;
“But ‘twas a famous victory.”

--Robert Southey

Epic Battles in History

I

Boehner Urges G.O.P. Unity in ‘Epic Battle’

...But on the matter causing all the Congressional stress, the speaker offered no clue as to how he expected Congress to get out of the dead end it has found itself in, with the government shut for a fourth day and no clear path to raise the federal debt limit to avoid the nation’s first default. “We are locked in an epic battle,” the speaker told his rank and file, those who attended the meeting said, urging them to “hang tough.”

The overarching problem for the man at the center of the budget fight, say allies and opponents, is that he and his leadership team have no real idea how to resolve the fiscal showdown....

  

  The New York Times, October 4, 2013

II

“Forward, the Light Brigade!”

Was there a man dismayed?
Not though the soldier knew
Someone had blundered.

  Tennyson

Frant's Law of Bureaucracy At the Government Shutdown

To understand how government works, you need to know Frant's Law of Bureaucracy, which states:

Problems with bureaucracy are almost never caused by bureaucrats. They're caused by politicians.

Public-sector bureaucracies, as we know, can be inflexible, and sometimes do things that seem irrational and counterproductive. For the most part, this is not because bureaucrats are inflexible or dumb. Nor is it because they lack the bracing effect of a profit motive or competition. No, for the most part bureaucrats do the things they do because that's what legislators have told them to do. They're following the law.

Of course, when following the law has bad results, politicians rarely see much advantage to taking the blame. Much better to be outraged by bureaucratic bungling and leap to the voters' defense. The hypocrisy of this strikes the untutored eye only rarely.

Here,  for example:

Heteronym of the Month

“I think it’s just the idea of, ‘Oh, I’m a sewer,’ that doesn’t thrill the average young individual today,” she said.

  From a New York Times article  on the return of the apparel industry to the US.