We are approaching the deadline for our debt ceiling. This deadline is a moving date. Janet Yellen estimates the checkbook balance will be red on or about June 1. Experts and Yellen is not in that group, think June 8 is more realistic.
When that happens, certain parts of the government, like defense, Medicare, and Social Security, will be funded, but non-essentials and our debt payments will stop. The United States Government will be broke and in default.
Speaker of the House Kevin McCarthy has the checkbook on his desk. He has leverage at this point over Biden and the Democrats, and he has to hold onto that leverage and not bend a knee to the Left. It is our only Ace in the stacked deck that is the Washington Swamp. We have to get spending concessions from the Democrats as a part of the process, or we never will. If we fold and extend the Debt Ceiling, the Democrats will never negotiate on spending limits.
Joe Biden met with Kevin McCarthy months ago and said he would negotiate with Republicans on a realistic budget. He lied. What a surprise. Not only has he not negotiated, but he has refused to speak with McCarthy, and Biden has used the media to do his speaking. Every opportunity he gets, Biden claims the MAGA Republicans are holding the country hostage. Even his mouthpiece, Karine Jean-Pierre, uses the MAGA catchphrase whenever possible, though she includes all House Republicans under the MAGA umbrella. It gets old for us, but it plays well with liberals watching CNN or MSNBC.
It is against their DNA for Democrats to discuss spending cuts, but any sane person knows we cannot stay on this spending trajectory. Joe Biden erroneously said today there is no connection between the budget and the debt ceiling. That comment shows how little Biden knows of economics. There is a direct correlation. If you keep spending and do not grow the economy, the national debt increases and we are back to square one. How could the President say something so bizarre? He then announced a press conference this afternoon, which his staff had to pull back immediately. It was a bad day for Joe, but aren’t they all?
Kevin McCarthy and the Republicans passed a budget resolution through the House capping future spending increases at 1%. It is a plan that funds existing commitments but limits runaway spending. It is a smart approach, but Chuck Schumer says the Bill will never see the Senate floor. That is how the Democrats negotiate. It is a sad abuse of power. Biden wants the debt ceiling covered, and then he will talk about spending. Sorry, Joe. You have burned your credibility. If you get your debt ceiling, you will never sit and negotiate.
McCarthy has to hold his cards, even if it pushes us over the edge when the debt ceiling expires. My money is on Red. I believe that Blue will blink, and we will extend our ceiling, but with constraints. Constraints are something this government needs like a toddler needs training wheels.
