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July 28, 2014

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The Policy Racket

Measure on raising debt ceiling not likely to gain traction

WASHINGTON - While the Senate spends this week out of Washington, the House will take a test vote on raising the debt ceiling, setting the tone for a critical policy debate that’s expected to stretch on through much of the summer.

The measure on offer would raise the country’s legally mandated debt limit by $2.4 trillion -- it’s currently at $14.294 trillion, a threshold the nation technically hit back in April, though Treasury Secretary Tim Geithner says we can avoid any fallout from that until early August.

The dark side of hitting the debt ceiling is a scenario that lawmakers on both sides of the aisle agree would mean defaulting on loans, downgrading the country’s credit rating, and devaluation of the dollar, all of which could disrupt global markets, freeze private companies’ ability to hire a la the recession and potentially pose a hit to government spending programs like veterans’ benefits and Social Security.

But “I voted to raise the debt ceiling” really doesn’t sound good in political utterance, and the measure the House will consider tonight isn’t expected to pass -- because Republicans aren’t expected to vote for it.

Republican leaders have been saying for months that any proposal to raise the debt ceiling without a simultaneous effort to cut the country’s deficit by trillions is a non-starter. The Republican-penned measure the House votes on tonight though, doesn’t seek to balance out raising the debt ceiling with cuts of any kind -- which is why it’s a show-vote, and Democratic leaders are calling it a waste of time.

“I can’t think of a way that is much more irresponsible than bringing up an extension of the debt limit extension just to show it can’t pass,” Senate Majority Leader Harry Reid said last week about the plan.

Republicans countered that it was an important message to send.

“I think it’s important for the markets and for everybody to understand that Congress doesn’t intend to raise the debt ceiling without doing something about spending,” Senate Minority Leader Mitch McConnell said.

It also appears to be part of a building pattern.

The House Republican leadership has adopted a first-strike policy on most points of the budget debate this year. They were first off the block with a bill to make cuts in fiscal 2011, and were first to vote on a budget proposal for fiscal 2012. They’ll be spending the rest of this week considering fiscal appropriations bills for the various departments of government -- something the Senate’s Democratic leadership has agreed to work on, but hasn’t yet started.

Part of that is constitutional procedure. Spending bills must originate in the House: it says so in Article I, Section 7 of the Constitution.

But part of it also appears to be politics. Neither the fiscal 2011 nor the fiscal 2012 spending bills that the House supported survived the Senate, and those were foregone conclusions from the moment they were drafted.

Some Democrats are expected to vote for the debt ceiling increase.

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