US Senate Successfully Kicks The Debt Limit Can Further Down The Road, Drama Ensues

The debt limit theater continues on Capitol Hill, with the United States Senate passing a temporary extension that left both party leaders under fire from all sides.

From Punchbowl News:

The Senate passed a short-term extension of the debt limit on Thursday by a 50-48 party line vote, staving off a potential fiscal and economic crisis until at least Dec. 3. This came after Senate Minority Leader Mitch McConnell and 10 other Republicans voted to break a GOP filibuster of the measure. That action ended a weeks-long standoff on the debt limit, but it also set up another massive showdown later this fall between McConnell and Senate Majority Leader Chuck Schumer.

There was some last-minute drama, as well. Schumer went to the floor and harshly criticized Republicans for provoking the crisis. Schumer won this round of his never-ending battle with McConnell, and he made sure everyone knew it. But Republicans — and Sen. Joe Manchin (D-W.Va.) — didn’t like the tone of Schumer’s remarks. Senate Minority Whip John Thune complained personally to Schumer on the floor, while Sens. Mike Rounds (R-S.D.) and Mitt Romney (R-Utah) complained to reporters.

Manchin told Schumer the speech was “fucking stupid,” according to four sources. Then Manchin complained to reporters too. The incident doesn’t really signify anything, except to show how tense everyone is in the Senate these days. And it’s only going to get worse.

Following the Senate’s action, House Majority Leader Steny Hoyer announced the House would return to Washington on Tuesday to take up the measure.

We expect it to pass. It won’t be pretty. There will be complaints by moderate House Democrats over having to vote for the measure, with at least one more such vote coming later in the year. Moderates wanted only one debt-limit vote in the entire Congress; the House is on track now for at least three. So yeah, they’re gonna grumble.

And let’s also quickly go over the new deadlines Congress faces:

→ Oct. 31: This is the date Speaker Nancy Pelosi set for passing the $1 trillion bipartisan infrastructure bill.

→ Dec. 3: This is the date that government funding runs out and the rough date the Treasury Department will again hit the debt limit. The government funding deadline is set in stone, while the debt-limit deadline can shift depending on the level of inflows and outflows out of Treasury at that time.

But know this — late November and December are going to be rough. It seems exceedingly unlikely that Republicans will help Democrats with lifting the debt limit again — no matter what Schumer’s world says. Then we’ll really have a default crisis and a government shutdown showdown on our hands.

In other words, we get to do this again… Again.

The debt limit is always going to be increased. Despite all the brinksmanship, neither party is going to be the one to let a financial disaster like default occur with their names attached to it. The drama is political kabuki to try and make the in-power party take all the blame by the out-of-power party. This is how it has always been. You can flip the parties and the story is the same. Right now, the Democrats have, albeit razor thin, the majorities and the power, thus they are the ones with the problem. Trying to shift blame on obstructions by the minority to keep the blame on the majority is also a tried-and-true part of this recurring drama. And so it goes…

What has complicated this version of debt limit theater is another recurring habit of congress, the “emergency/deadline legislating” of piling up major pieces of law to try and force them through. In this case, the Infrastructure Package and the massive, $3.5T budget proposals that are in reconciliation right now. All three things have crashed together, and — assuming the House passes the extension on Tuesday — the clock will start running again to deal with the latter two before the third comes up again.

This is our elected leaders’ own fault. They give the game away when they can pass “clean” bills on an emergency basis at the last minute, yet linger over the massive outlays chocked full of items no one, including the congress critters, have read or even know about until after it passes. Senate Majority Leader Schumer and Minority Leader Mitch McConnell are old hands at this, know the game, and know each other. The realities of a 50-50 Senate have fully caught up with the months of rhetoric about electoral mandates, generational change, and whatever other buzzwords where pressed into service for a once-hopeful Biden agenda.

The Biden Administration has developed a pattern of being reactionary to events, chasing problematic optics and fixing those news cycle spot fires by fixing the optics. But being reactionary often means not having a plan to prevent or handle events ahead of time, and fixing optics does not fix the underlying issues. The plan –such as it was — by the president and congressional leaders for an “FDR-like” moment turns out to have been the foolish hope most people who looked at the makeup of the US Senate thought it was, and the optics of that foolishness are now on full display. The only question now is, will our elected leaders switch to trying to work out the issues as they exist, or will the theater continue a little while longer until self-manufactured crisis again demands action.

History tells us to expect the latter, and a fall of legislative discontent leading to a long winter indeed for all involved.