Debt Ceiling

By Thomas Schmitt

The Bipartisan Coalition’s inaugural 2023 roundtable focused on the debt ceiling— at
least, that was the official topic of discussion. We started with a general straw poll about which course of action we favored regarding the debt ceiling:

A) Abolish the debt ceiling.
B) Keep the debt ceiling and raise it as needed

Then, the moderator offered, in jest:

C) Or both parties could just keep using it to further their political agenda every year.

The room mostly laughed off option C, but we were lucky enough to have one brave member who took that option more seriously. His comments provided the basis for our discussion, which, while nominally related to the stated topic, raised more far-reaching questions about the nature of American media and problem-solving.

The sole member who elected option C argued that the nearly annual scramble to raise the debt limit might actually provide a unique environment for bipartisan cooperation (we love that here at GBC). The prospect of an apocalyptic default provides some leverage to the minority party, which can filibuster any bill that would raise the debt ceiling. The minority can offer an ultimatum: offer us concessions or be blamed for the default. Other members, however, questioned the political viability of such an ultimatum. Would the majority party really be blamed for the default in this case? Can anything productive really come out of such a volatile environment? Though we had disagreements answering these questions, we did come to a rather demoralizing collective realization: There really is almost no other time when both parties are drawn to compromise, as they are when the debt ceiling approaches.

As we considered the politics of leveraging a default, we also began asking if anyone seriously believes that defaulting is a realistic possibility. And if not, why does the media make such a big deal of it? Well, it didn’t take us too long to figure that out. A potential catastrophe, and the theater trying to prevent it, makes for good television. The media wants to generate enough hype to convince the public that the threat of a default is real. From there, they can get a lot of mileage from the months of bickering it usually takes for both parties to reach an agreement. Many of the members were frustrated that as the topic of the debt ceiling goes around the torturous media merry go-round, it takes up oxygen from issues that really matter. The reality is, the media will always do what they believe is best for ratings, and most viewers would prefer to engage with drama than in meaningful dialogue. The onus is partly on us, the American consumer, to change the narrative around the issues that should be talked about. “Where does this roundtable fit in that process?” We wondered.

One member argued out that the conversation provoked by the encroaching deadline is necessary, albeit unpleasant. Nobody at the meeting was satisfied with the debt ceiling precisely as it is now. The annual circus is embarrassing, exhausting, and wastes significant time that could otherwise be spent legislating. It seems that we must talk about the debt ceiling, even if only as a means to avoid talking about it again. So we returned to our original question: What should we do?

Two general positions were taken:

1) The debt ceiling is a canary in the coal mine, telling us we are spending too much money. We should keep the limit but make policy changes, so we don’t hit it. And we can raise it if we absolutely have to.
2) We should probably be spending less money (or raising taxes), but the debt ceiling is not a good way of enforcing that. We should eliminate it to save everyone the time, energy, and fear of catastrophe.

I am not going to endorse one view or the other. To be honest, I am not sure many of the members present would have felt comfortable planting their flag firmly in either camp. There are a few things we collectively agreed on, though. Firstly, the media sucks. But we already knew that. Second, it is pretty sad that it takes a potential crisis to force our elected officials to an even superficial negotiating table. Perhaps, our politicians should follow the example of GBC roundtables. If good faith leaders from both sides sat down and tried earnestly to devise a solution to this universally mocked phenomenon, maybe we wouldn’t be in this mess. I know… Wishful thinking.