The Republican rebellion continues and has shut down Parliament. The United States' creditworthiness is now under jeopardy.
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| Speaker Kevin McCarthy |
Is the United States in danger of jeopardizing its creditworthiness? US Treasury Secretary Janet Yellen has declared that the federal debt ceiling will be hit as early as this Thursday, forcing the federal government to adopt extraordinary steps to satisfy its payment commitments, such as state pensions and health insurance payouts. In the longer term, there is not only the prospect of a government shutdown, i.e. the forced closure of federal authorities, but also a long-term and costly harm to the United States' creditworthiness. Yellen urged the newly elected speaker of the US House of Representatives, Kevin McCarthy, to push for the debt ceiling to be suspended or extended immediately.
But McCarthy has a problem: he had to pay a high price to particularly uncompromising members of his own group for his late success in the 15th ballot , including on questions of procedure, and is now effectively being held hostage. A single member of parliament can apply for the speaker to be dismissed. Given the narrow majority of Republicans, any controversial vote becomes a potential no-confidence vote against McCarthy.
Raising the debt ceiling is a given because Congress has already authorized the budget for 2023, which means that more debt must be incurred. But, for the radical members of the House Republican Freedom Caucus, he is a vital emblem of the Washington establishment's "rotten compromises" that they wish to reject. They also made McCarthy's agreement contingent on the cap being raised only in the future in exchange for severe budget cutbacks. This demand is broadly supported in the legislative group, but only the most committed MAGA Republicans - dubbed after Trump's campaign slogan "Make America Great Again" - practiced the rebellion and even disobeyed their idol in the meanwhile.. It's not primarily about ideology, but about fundamentals.
As a result, as Marco Bitschnau writes, McCarthy is far from certain as Speaker for the next two years. On the one hand, he is a shameless opportunist who, as is well known, made a trip to Mar-a-Lago right after the revolt on January 6, 2021 to kiss Trump's ring - a decision that, given his involvement at the speaker, undoubtedly paid off, at least for the time being. McCarthy, on the other hand, is concerned in how the institution works, in how the government works. That implies he's willing to make nonpartisan concessions - he has to be willing due of his position - on issues like lifting the debt ceiling.
Biden and the Democrats have also announced their willingness to compromise – they have no choice, because they are also indirectly held hostage by the Freedom Caucus.
But the MAGA Republicans' rebellion is not over, and there is no truce in sight. Because a portion of the Republican Party appears willing to accept the closure of government agencies and the threat to the United States' creditworthiness - and they will not hesitate to let McCarthy jump over the blade, as McCarthy's Republican predecessors in the previous Office of Speaker — John Boehner and Paul Ryan — who were also willing to make the necessary but despised bipartisan compromises.
But what are the Freedom Caucus members still concerned about? Matt Gaetz, one of the "rebels'" ringleaders, rationalized his abstention in the last voting of the speaker race, which allowed McCarthy to win, by saying he couldn't think of anything more to demand. McCarthy appointed them to major committees and offered them the chance to study the federal government's weaponization, i.e., the alleged witch hunts against conservatives by the FBI, the IRS, and others. He was even forced to swear that he would no longer vote against Freedom Caucus candidates in the Republican primary and that other MAGA Republicans would work, i.e. no money would be organized against them.
That has to do with the Speakership; doing nothing demonstrates that the "rebels" are solely concerned with power. This explains her fondness for media-effective spectacles, gallery acting, and indifference in genuine legislative work. Because most MPs come from safe districts and must focus on the primaries, where Trump's support frequently sets the tone. If you only seek for content-related interests and try to find room for compromises, you are mistaken: the base favors those who are persuaded and despises concessions. That is why focusing simply on the MPs who led the opposition against McCarthy is also a mistake.
Even if the personality cult that has surrounded Donald Trump has lately collapsed, the new Republican segment is just a reflection of the party that has transformed as a consequence of his impact. There are few moderate conservatives left. The majority of parliamentarians believe Trump's falsehood about voting fraud and are eager to damage democratic institutions, even if it means going beyond the outrageous but legal administrative limits on minority voter participation. Although the Freedom Caucus, which arose from the Tea Party movement, has just around 40 members, it is expanding and contains members who are not influenced by the speakers' election.
These politicians believe that obstructing the Biden administration's initiatives and pestering them with committees of investigation is insufficient. Some people now appear to trust their own conspiracy theories about a hostile deep state manipulating things behind the scenes. That's why, like with the speaker election, there's an increasing inclination to let the federal government go if they don't get what they want. Some of the radical rebels can be considered revolutionaries in this sense. They are no longer amenable to bargaining.
This puts McCarthy, as well as the Democrats, in a difficult position. If the radicals refuse to compromise on lifting the debt ceiling – which needs to be bipartisan due to split government, because the administration and majority in parliament are divided between parties — McCarthy may risk impeachment if he ignores them. If the Democrats do not want the House of Representatives to become completely dysfunctional, they must either support him or at least support the speaker-include election. Alternatively, Democrats may take a risk and accept a brief closure of federal departments in the belief that Republicans would be held accountable for the effects by the 2024 election. But the risk of a recession and permanent damage to the creditworthiness of the US is big.
There is yet time. Because of the emergency steps taken by Yellen, government officials may continue to work for the time being. Biden even wants to postpone talks with Republicans until after the April tax deadline, when the government budget situation would be clearer. But with whom will he genuinely bargain? With McCarthy and the remaining "real" conservatives who care about how the institutions work? Or indirectly with fanatics determined to render the federal government absolutely incapable of acting, even if it means endangering their own voters?
It is very feasible that the uncompromising radicals will finally triumph in this domestic political game with fire, exactly because they care not only about the Republican majority, but also about the country's well-being. If all goes well, the 2024 budget will be released soon, including funding for Ukraine, which is opposed by the Republican faction's isolationist and dictatorial elements. McCarthy has also made concessions that make compromise more difficult: there will no longer be package solutions; instead, individual budgets must be chosen. In American politics, stagnation and chaos have become the new normal.
The author Thomas Greven is a political science teacher at the Free University of Berlin's Kennedy Institute and the editor of German and foreign newspapers.