Home > Congress, Domestic Policy, Economic Policy, Economy > Debt Ceiling Negotiations Are Now Almost Unavoidable

Debt Ceiling Negotiations Are Now Almost Unavoidable

Now that the government shutdown does not seem to be ending anytime soon, liberals are going to have to accept the fact that the debt ceiling is no longer non-negotiable, at least from a messaging standpoint. With both sides digging in, there seems to be little hope of solving the government shutdown before October 17 when we hit the debt limit. That means that any negotiations over a continuing resolution – which will happen eventually – will also have to include a debt ceiling raise. From Politico today:

Reid is highly unlikely to accept a budget deal if it does not increase the debt ceiling, Democratic sources said Tuesday. If the House GOP won’t back the Senate’s stopgap plan by later this week, Democrats are prepared to argue that it makes little sense to agree to a short-term spending bill if Congress is forced to resolve another fiscal crisis in just a matter of days.

A White House official said Tuesday night that the president could get behind Reid’s strategy.

Across the Capitol, House Republicans were quickly coming to a similar conclusion. Republicans were internally weighing including a debt ceiling hike in their demands to convene a House-Senate conference committee to discuss a bill to reopen the government. In the coming days, the GOP leadership is likely to change its rhetoric, with Republicans arguing about government funding and the debt ceiling in the same breath.

The two issues are now inherently connected. The president can maintain his position that he will not negotiate over the debt ceiling, but it will be harder to prove that is the case. In a worst case scenario, Democrats actually do negotiate over the debt ceiling and it becomes a piece in the compromise. That would once against set precedent for the debt ceiling to be used as an extortion device. Senate Majority Leader Harry Reid (D-NV) cannot let that happen.

But even the best case scenario is not very satisfying. In that situation, Reid declares that Congress must raise the debt limit and Republicans acquiesce. Except because of the tight schedule, the two sides continue negotiating over the CR. Eventually, they come to some type of agreement and both sides pass a bill with that includes a debt ceiling increase. In this case, the debt ceiling was never part of the negotiations and was never used as an extortion device, but that’s hard to prove. The media will analyze the deal as if it was part of a compromise. Republicans will head home to their constituents and say that they made the Democrats negotiate over the debt ceiling. They will say they broke President Obama’s no-negotiating position. Democrats will have no way to prove otherwise. It will be their word versus the Republican’s and the final deal will have a debt ceiling increase in it. Once again, the precedent will be set for using it as an extortion device.

There is one way to avoid all of this though: President Obama can unilaterally raise the debt ceiling. Unfortunately, this is highly unlikely to happen. The Administration ruled out using the 14th Amendment again yesterday and minting a trillion-dollar platinum coin seems even more absurd. Nevertheless, this would eliminate the need to raise the debt ceiling and prevent any negotiation over it. If Obama is really determined to not negotiate over the debt ceiling, he will look at both options carefully, because negotiating is now unavoidable.

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