Ross Douthat: Debt-Ceiling Extortion Isn’t So Bad, Really

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What if you just asked for a smaller sum? That would be reasonable!

The debt-ceiling fight strikes me as a fairly simple situation. Congress used it to posture about the budget deficit, but the situation fundamentally changed in 2011, when Congress used the debt ceiling as a hostage to force the president to agree to otherwise unacceptable terms. This new situation is both Constitutionally dangerous, because it gives gun-to-the-head power to unscrupulous parties, and economically dangerous, because it infuses inherently fraught policy negotiations with the risk of catastrophic failure. Therefore, President Obama’s main responsibility is to end the institutionalization of debt-ceiling extortion by refusing to be extorted.

The conservative response to this analysis has consisted almost entirely of dodging it. Conservatives have endlessly repeated John Boehner’s absurd talking point that debt-ceiling extortion happens all the time, or pretended that old-fashioned posturing over the debt ceiling like Obama did as a senator is the same thing as holding it hostage for policy concessions, or otherwise failing to engage the question. Ross Douthat today finally comes much closer to engaging the issue than any other conservative I’ve read. But ultimately he, too, is dodging the question.

Douthat passes rapidly over the entire crux of the issue in the first half of this passage:

…makes it sound like the very idea of negotiating around the debt ceiling is unprecedented (which it isn’t) and a threat to the constitutional order (which it hasn’t been), and makes it seem like the Republican Party’s grave sin is the politicization of the debt ceilingper se (even though both parties have regularly politicized it), rather than the fact that the G.O.P. is trying to enter into debt ceiling negotiations in pursuit of politically-impossible goals.

Stop. Let’s review the first part of this. Douthat’s formulation is that “negotiating around the debt ceiling” has happened before. I’m not sure what this means. The parties have previously negotiated over the form, length, and general body language of a debt ceiling hike — i.e., Tip O’Neill demanding a letter from Ronald Reagan to every House Democrat requesting a debt-ceiling hike, to insulate them from political attacks. They have also appended debt-ceiling increases to separate negotiations over fiscal policy. What never happened before 2011 is a party threatening default in order to force the president to accept otherwise unacceptable conditions.

By simply asserting that this new, dangerous change is an old, familiar one, Douthat builds the rest of his argument upon an unsupportable premise. He proceeds to assert that the debt ceiling “hasn’t been” a threat to the Constitutional order, though of course the premise of Obama’s argument is that if it becomes a regular feature of negotiations, it will be one. To say it hasn’t yet been one is to miss the point. North Korea's nuclear program hasn’t killed anybody.

What are we worried about? Photo: null/Getty

Douthat proceeds to argue that debt-ceiling extortion would be fine if Republicans had attainable policy demands. It’s somewhat of a characteristic flaw of Douthat’s style that he dwells inordinately on the imagined world in which the sane, technocratically reasonable Republican Party he wishes existed actually exists. Here the fantasy is taking the form of imagining that debt-ceiling extortion would be okay if only it would be used exclusively in pursuit of a Douthatian agenda. (“It’s the fact the House G.O.P. seems incapable of moving close enough to Obama to cut a significant deal that’s the issue, not the idea that the debt ceiling is an appropriate occasion for dealmaking.”)

But if Republican demands are less grandiose than the party’s current demands, but still could be obtained only through extortion, how is that okay? Why would you trust parties to limit their own power by being modest in their goals? The incentive structure by its nature encourages them to push the window as far as it can be pushed. That creates inherent Constitutional dangers and inherently creates the risk of default (because, of course, the president has to counter-threaten to allow default, or else Congress could force him to sign any bill that is even marginally less damaging to his interests than the catastrophic impact of a default).

Ultimately, Douthat is not grappling with any of the structural problems inherent in leaving the weapon of default lying around the political system, waiting to be picked up by any sufficiently ruthless actor. He’s subsuming the problem in a fantasy world in which nobody would ever use such power irresponsibly.

The oddest part of his argument is where, in the course of a sentence, Douthat essentially concedes that Obama is right — in practice, Republicans are making impossible demands, and therefore extorting him, so Obama is right not to negotiate — but, rather than even briefly let that conclusion settle, he pivots to a different point. Obama is making himself appear unreasonable by refusing to negotiate (“in the realm of public rhetoric and public positioning pressing this argument hasn’t served the White House well”). Having hastily abandoned his moral reasoning and turned to the question of public-relations messaging, Douthat offers Obama some of the weirdest advice I have seen:

Well, he could say something like this: I join with Congressional Republicans in favoring further steps to reduce the budget deficit in advance of the debt ceiling vote. I have made an offer, embodied in my budget, to combine entitlement cuts with a tax reform that closes loopholes and deductions and uses the savings to reduce the deficit. I await a reasonable counteroffer from Speaker Boehner: I am open to many possible deals, but as I have said on many occasions, I will not let the Republicans balance the budget while exempting the wealthy from their fair share of the burden. My preference is always to compromise, but in the event that the Speaker cannot present a reasonable counteroffers, and continues to make unreasonable demands, I trust that the House will fulfill its duty and raise the debt ceiling cleanly, rather than throwing the American economy into a recession and threatening the full faith and credit of our republic.

Why is this weird? Because this is exactly what Obama has been saying. Here, to take the first example I looked up, just read his remarks to the Business Roundtable. Mentioning his compromise budget that would reduce the long-term deficit? Check:

The budget I put forward actually proposes some smart fixes on Medicare, some smart fixes on Medicaid, and creates a sustainable path where we continue to invest in the things we need to grow — education, infrastructure, research and development — deals with our long-term structural deficits that arise out of entitlements

Offering to negotiate a budget deal with Republicans if they have reasonable demands? Check:

I am prepared to work with Democrats and Republicans to deal with our long-term entitlement issues. And I am prepared to look at priorities that the Republicans think we should be promoting and priorities that they think we should be  — we shouldn’t be promoting. So I’m happy to negotiate with them around the budget, just as I’ve done in the past.

Demanding that, apart from those negotiations, they increase the debt ceiling rather than cause an economic meltdown? Check:

the good news is that we can raise the debt ceiling tomorrow just by a simple vote in each chamber, and set that aside, and then we can have a serious argument about the budget.

So this is a very strange column. Douthat spends most of it either imploring the Republicans to do something reasonable they plainly can’t, or imploring Obama to do something reasonable that he is in fact doing. His solution of a non-pathological Republican Party is wonderful and I wish him all the best. His objection to my argument seems to revolve around the fact that I’m working around the existence of the actual Republican Party.