Debt Limit Drama: Meh

It seems to me that all the debt ceiling drama is overwrought. It would certainly be a mess if the government defaulted, but predictions of armageddon are probably over-stated. Since it has never happened before nobody knows what would really happen.

In any event, we’re not likely to have to find out. It looks like Pres. Joe Biden and Speaker Kevin McCarthy are negotiating in good faith and that they’ll work something out. It’s certainly good to see them trying. The simple image of the two sides sitting down and trying to figure out a compromise is refreshing. It would be nice if they could get into the habit of doing that on other things.

If they do come to a deal it’s a fair bet that you won’t hear about the debt limit for the two years or however long it is that the new ceiling is in place. What seems like the central issue of our time today will be forgotten by the summer solstice. It’s likely to have no direct impact at all on the 2024 elections.

Let’s hope these guys can work something out.

But what will matter then is the state of the economy and that’s why the debt limit and how it gets resolved matters. Biden’s approval ratings have been in the tank for almost three years and nothing he does seems to move his numbers. I wouldn’t expect that averting a debt limit crisis will help his popularity any more than passing an historic infrastructure bill did or getting us out of Afghanistan did or getting to the first compromise gun control legislation in decades did or sending people big checks did.

It’s not that Biden will get credit for fixing the debt limit, but he might avoid more blame for a bad economy in the fall of 2024. With numbers as low as his are, Biden absolutely cannot afford either a deep recession or continuing high inflation as he approaches his reelection. To the extent that a debt limit deal helps him avoid either of those things it’s more than worth whatever it is he has to give up.

It feels like, in fits and starts, we may be getting to the soft landing that the Fed has been aiming for. Inflation projections are down to about 4% for the rest of the year and unemployment remains low. The economy shows some signs of cooling while it shows other signs of remaining strong. It was never going to be a straight line, but it looks like we might get there.

This nation can handle just about anything except four more years of Donald Trump. If some deal — any deal — on the debt limits helps us avoid that I’m for it.


Published by dave cieslewicz

Madison/Upper Peninsula based writer. Mayor of Madison, WI from 2003 to 2011.

2 thoughts on “Debt Limit Drama: Meh

  1. I don’t think that the “Freedom” Caucus is interested in compromise. In fact, they want the Senate to just pass their legislative can of worms. I also don’t share your optimism on the outcome. This fiasco could set in motion a chain of events that no one can control and from which we will never recover. Biden may be forced to invoke the 14th Amendment just to get any forward movement. Then we’ll get to see if the Supremes want to vote us into the next Great Depression.


    1. I don’t think the Freedom Caucus will compromise. I also don’t think the hard-left will. I think McCarthy and Biden have to thread the needle to get enough Democrats and Republicans who are less extreme to make a majority.


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