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It is hard to believe that I am writing these words, but there is a real possibility that Congress will not pass an increase in the debt limit. That would mean the US could, in turn, default on its debt sometime in June.
No one knows what would happen at that time, because it is unprecedented. But it would almost certainly be deeply unpleasant, with huge job losses, unpredictable bits of the imploding economy, and knock-on effects in other countries that will make them fear and hate us for decades. It would be the kind of massive self-inflicted wound that can only be dealt with by empires in their sleep.
Congress has come close to this disaster in the past. But I’ve always believed that it would be impossible for that to actually happen, because the financiers of the Republican Party on Wall Street and corporate America understood the damage it would do, not just to the country in general, which they don’t. it matters to them, but also to them specifically, and I wouldn’t allow it.
I still think this is the most likely outcome, fingers crossed. However, the GOP’s donor class, never fond of reality to begin with, has drifted further and further into the swamps where politicians and the party base live. Many of the ultra-rich on the right used to understand the world well enough to act in their own self-interest. Some still do. However, this minority now has far less power than the billionaires who are as hooked on Fox News as the base of the party. And these billionaires suffer from the same cognitive impairment that Fox inflicts on all his devotees.
And this brain-damaged community has a consistent worldview: that for America’s survival, they must destroy the “administrative state” aka the New Deal aka everything people like of the federal government, such as Social Security or regulations that stop chemistry. companies dumping poison into drinking water. Meanwhile, ordinary Americans have no idea whether the law provides for it, or even what those words mean.
Any reading of history other than the hard right suggests that the New Deal, and the basic infrastructure of American politics it created, was a compromise that allowed human beings to live with capitalism. The only alternatives in the 1930s were (on the right) some form of fascism that would keep capitalism but eliminate democracy, or (on the left) dismantle capitalism and try something completely different.
The American right has now come to the conclusion that this compromise was a disastrous mistake, a mistake they now hope to begin to correct by manufacturing this crisis. Grover Norquist, founder and president of Americans for Tax Reform and a key strategist on the right, said in 2001, “My goal is to cut government in half in twenty-five years, to reduce it to the size we can drown him in. the bathtub.” Just in time, they see a key opportunity to begin fulfilling Norquist’s dream.
This perspective did not always enjoy popularity within the Republican Party. Dwight Eisenhower is famous wrote this to his older brother in 1954:
The federal government cannot avoid or escape from the responsibilities that the mass of the people strongly believe it should assume. … If any political party tries to abolish social security, unemployment insurance, and eliminate labor laws and farm programs, I would never hear of that party again in our political history. There is a small splinter group, of course, who believe you can do these things. … Their numbers are insignificant and they are stupid.
You can judge for yourself whether people like this are stupid, but it is indisputable that their numbers are no longer negligible. In fact, today Eisenhower would be considered a terrifyingly awakened Marxist by much of the Republican Party. Newsmax would run 37 segments exposing his damning admission to his brother that “the policies of this Administration have not changed radically from those of the last.” In other words, he started from the same essential premises as the New Deal Democrats.
This is no longer the case; GOP leaders want radical change, and they believe they can get it. As former Vice President Mike Pence recently said, “I think the day may come when we can replace the New Deal with a Better Deal.” Strategists like Steve Bannon vote to drive the “deconstruction of the administrative state”. The types of spending cuts demanded by the bill passed by the House it would be a powerful first step in ridding the administrative state of taxes and regulations that have oppressed us for so long.
Achieving Bannon’s ultimate goal would mean a return to pre-New Deal politics, with Americans once again facing the kind of vicious predatory capitalism that can only exist when democracy is severely hampered: It is not appreciated that the glory days of this form of capitalism occurred when most adults could not vote. This is what Peter Thiel had in mind when he censored “the extension of the franchise to women” and explained that the freedom of capital was incompatible with democracy.
Right-wing thinkers have managed to convince their most prominent politicians that this is the way to go. Florida Governor Ron DeSantis, for example, has consistently blasted the administrative state in his embryonic presidential campaign. They all either don’t understand the implications of what they’re pushing for, or they do but are sincere authoritarians. In any case, they feel they have no choice, since what Republicans like Eisenhower considered normal politics is, in fact, the road to a kind of apocalypse. If the US stays within the framework of the New Deal, they think, it will inevitably lead us to a totalitarian future, with starving Americans catching rats to eat and forcing every 5-year-old to undergo sex-reassignment surgery. As Tucker Carlson recently told the Heritage Foundation, probably the most powerful think tank on the right, what they’re facing now “isn’t a political movement. It’s evil.”
This sounds absolutely crazy, and it is. But that doesn’t change the fact that a significant portion of the American right believes it. Some understand that a US default would cause a significant amount of pain. But they believe this is necessary to avoid the much greater pain that is currently headed our way, when Bill Gates will personally vaccinate everyone at gunpoint every three days. In fact, in intimate moments, they probably break down because of their own courage, they perceive themselves as true patriots willing to make this sacrifice for the greater good.
They also understand that any suffering on the part of ordinary people will likely affect their political gain. After all, the Democratic Party itself has been proclaiming the dire consequences of the national debt for the past 30 years. Bill Clinton announced in his 1996 State of the Union address that “the era of big government is over.” In Barack Obama’s 2011 State of the Union address, he told us that “we have to face the fact that our government is spending more than it needs to. That’s not sustainable.” Last fall, the Biden White House proudly declared that they had achieved “the largest-ever drop in the federal deficit.” All Republicans want to do now is negotiate to restore the kind of fiscal sanity that Democrats have endorsed since the 1990s. How can Joe Biden refuse?
Apparently, the Biden administration had a plan to deal with this situation. It was for they close their eyes and wish it was still 2011. The Washington Post quotes a senior Obama official at the time, during an earlier confrontation with the debt limit, as saying that his playbook had been “getting business leaders in key districts to pressure their congressman to said how important it was that the US not default on its debts.” However, “This is not the Republican Party of George W. Bush or his father. Most of them don’t care if the CEOs of Fortune 100 are freaking out.” Apparently, finding out has baffled the Biden team and left them with no other idea but trying the same again.
It would be nice to believe that Biden has a secret team ready to spring into action and execute one possible bold solutions if the debt limit is not increased over time. However, no reporter or expert close to the White House has been able to locate much evidence of this. The most that seems to be happening is heated debate within the Biden administration over whether they could claim the 14th Amendment to the Constitution forces them to ignore the debt limit and continue to borrow money — a debate that, given the GOP’s obvious track record, they should to have solved two seconds after the Republicans took money. the House in the 2022 midterms. The possibility that the people at the pinnacle of power have no credible plan to avert a swift catastrophe seems impossible, unless one is familiar with all of human history.
So get ready. A political faction has moved into a fantasy world. Meanwhile, the other faction lives in another fantasy world in which the first faction has not. Things here in the reality of our faded empire may be about to get pretty complicated.
