“extort”: to obtain from a person by force, intimidation, or undue or illegal power.
In other words, if you don’t give me what I want, something very bad will happen to you. This is not the same as negotiation.
“negotiate”: to confer with another so as to arrive at the settlement of some matter.
You’ll get something you want, I’ll get something I want, and neither of us will be too worse off.
Which brings us to the debt limit or debt ceiling:
Management of the United States public debt is an important part of the macroeconomics of the United States economy and finance system, and the debt ceiling is a limitation on the federal government’s ability to manage the economy and finance system. The debt ceiling is also a limitation on the federal government’s ability to finance government operations, and the failure of Congress to authorize an increase in the debt ceiling has resulted in crises, especially in recent years.
Prior to 1917, the United States did not have a debt ceiling, with Congress either authorizing specific loans or allowing the Treasury to issue certain debt instruments and individual debt issues for specific purposes. Sometimes Congress gave the Treasury discretion over what type of debt instrument would be issued.
Between 1788 and 1917, Congress would authorize each bond issue by the United States Treasury by passing a legislative act that approved the issue and the amount.
In 1917, during World War I, Congress created the debt ceiling with the Second Liberty Bond Act of 1917, which allowed the Treasury to issue bonds and take on other debt without specific Congressional approval, as long as the total debt fell under the statutory debt ceiling. [Wikipedia]
The story of the debt limit “crises, especially in recent years” begins in 2011. From Brian Beutler of Crooked Media:
Just as clear-eyed political analysts knew well before President Obama that Republicans would abuse the filibuster rule in an unprecedented way to stymie his agenda, they also recognized before the Democratic leadership that, after crushing Democrats in the 2010 midterms, Republicans would take the further unprecedented step of extorting Obama under threat of default. That’s why reporters asked then-Senate Majority Leader Harry Reid why Democrats, with their huge 2009-2010 majorities, wouldn’t neutralize the threat before Republicans took power.
“Let the Republicans have some buy-in on the debt,” Reid said.
This was the beginning of a fateful error that culminated in a significant shock to the economy, still hobbling out of the great recession, followed by years of indiscriminate, across-the-board discretionary-spending cuts, which Obama paid the Republicans in ransom.
This was supposed to be Obama-era Democrats’ biggest regret, one that they were committed never to relive. For the rest of Obama’s presidency he rightly refused to make unreciprocated concessions for further debt limit increases, and each time Republicans eventually caved.
But it isn’t foreordained that Republicans will always cave, every time a Democratic president refuses to be extorted, from now through eternity. Republicans never forswore weaponizing the debt limit. Neither was their lurch further into extremism a piece of forbidden knowledge. Right out in the open, through the Obama and Txxxx years, Republicans have become significantly more aggrieved and vandalous, and because of that, permanently disarming the debt limit has become a matter of greater and greater urgency….
If Democrats were like Republicans, they would’ve treated turnabout as fair play, and held the debt limit hostage for ideological policy concessions after Txxxx took office. Of course, the parties aren’t similar, and Democrats never considered this, nor should they have: Extortion is extortion, and every bit as anti-democratic as stealing court seats, or elected offices.
But I did think that when Republicans came to Democrats for help increasing the debt limit, Democrats should have made one demand: that in exchange for their votes, Republicans would have to relinquish the debt limit as a tool of extortion forever. This could have taken many forms: Outright debt-limit abolition, indefinite debt-limit suspension, a debt-limit increase of effectively infinite size, or the permanent delegation of authority to increase the debt limit to the executive branch. Either way, the idea was that Democrats should have had enough dignity to insist the parties be bound by a single set of rules, and make it the price of bailing Republicans out of a jam.
Democrats instead gave their votes away for free….
By the end of the last Congress, with Republicans poised once again to control the House under a Democratic president, the idea that Democrats should use their narrow, lame-duck majorities to moot the debt limit grew into something like a clamor…. Democrats thus had to respond to it, and their response was: sorry, no. This time, they seemingly just didn’t have the votes. But Democratic leaders expended almost no public effort trying to whip them up. Instead they and their loyalists treated supporters to excuses ranging from ‘we don’t have enough time’ to ‘we are leaving the doomsday device armed and ticking on purpose!’ How better to force Republicans to produce a budget, which will contain unpopular policies, the better to run against?
So House Republicans have produced a budget. It’s filled with unpopular proposals they could never get implemented through the normal budget negotiations with the president and Senate that take place every year.
Their position is: give us all or much of what we want or we’ll create a financial crisis as bad or worse than the one in 2008. The government won’t have enough money to function and all hell will break loose. Extortion.
Biden’s position is: raise the debt limit, as Congress has always done before, and then we’ll negotiate the budget like we always do. Negotiation.
You might think it’s fine for Republicans to finally force Democrats to cut the spending Republicans want to cut and leave alone the spending Republicans want to leave alone. Do you think it would be fine for Democrats to do the same thing when there’s a Republican president? Regardless, letting a minority compel the government to meet its demands is not how a representative democracy is supposed to work. Democrats gave in to extortion before and they shouldn’t do it again.
Back to Mr, Beutler:
Democrats find themselves at a choosing moment once again, only this time, they lack the means to disarm the debt limit with new law. Their choice is between caving to Republicans and maneuvering aggressively to disempower them….
Biden should be prepared to leave Tuesday’s meeting with Congressional leaders and announce that if Republicans attempt to default on the national debt, his administration will protect the country.
… He can instruct the Treasury to continue auctioning bonds, and if Republicans then choose to sue the country into default, and the Republican-controlled courts choose to order the country into default, it will be on them. Biden could further justify this decision by referencing the 14th amendment, which holds the sovereign debt inviolable. [Other options have been proposed and are supposedly being considered.]
… We need Democrats who will stop treating the Republicans’ serial default threat as a prompt to outmaneuver them, and instead simply overturn the game board… Republicans are the minority, trying to impose their will on the whole country by threat of mass harm, and that isn’t compatible with freedom or self-government. It isn’t hard bargaining, it’s terrorism.
Anything less than continued, complete refusal to negotiate would, in a profound and troubling sense, represent a violation of the oath of office. In a more partisan sense, it would breach the trust of millions of voters who view the Democratic Party as the last line of defense against extremist depredations. It’s hard to imagine a clearer way to signal that, when push comes to shove, they’ll appease bullies, instead of standing up for us—and they’ll do it by handing over our lunch money.
The country can’t survive in the long run if one shameless faction wields power in a consequence-free realm, while the other quietly acclimates itself to the mounting extremism. Eventually the trespasses will be incompatible with self-rule, and it will bring the whole republic down.
Note: In a TV interview, when asked if he might cite the 14th Amendment in order to bypass the debt limit (the amendment says the nation’s debt should not be “questioned”), Biden said he’s “not there yet”.