Solving the debt ceiling dilemma with Rep. Brendan Boyle —
As Washington heads toward a potential U.S. default date of June 1, the ranking Democrat on the House Budget Committee says there are sticking points in negotiations over whether to extend or suspend the central negotiating point. Loan limit Future costs are reduced and their duration deepened.
“By far the biggest sticking point is just the numbers,” Democratic Rep. Brandon Boyle of Pennsylvania told CBS News on “The Takeout.” “The duration of the (spending) caps and their intensity, that’s what it’s all about. That’s 90% of it.”
Boyle also said House Republicans would have to abandon their push for a 10-year cap on domestic discretionary spending. Boyle said the White House and congressional Democrats would never agree to cuts in that term, no matter the size.
“Forget it,” Boyle said of the idea of a decade of spending cuts. “It’s not going to happen. The deal should be as long as you’re raising the debt ceiling. If it’s a two-year deal on the budget, we’re raising the debt ceiling for two years. If it’s one year for one. It’s one year for the other. That’s absolutely fair. And I can’t imagine the Democrats will accept anything less.”
Overall, Boyle is optimistic that a deal can be reached soon.
“I think it’s obviously more positive now than it was a few days ago,” Boyle said. “It’s not too surprising because the closer we get to the ‘X-date,’ the incentive for everyone to reach an agreement increases.”
Boyle is in close contact with White House negotiators and doesn’t believe the Republicans’ proposed changes to energy exploration permits and returning billions earmarked for Covid relief or preparedness are obstacles.
“I think there’s real flexibility when it comes to this topic,” Boyle said of reclaiming the Covid funds. “It’s not a stopgap (and) I’d be surprised if things like unspent COVID funds or the authorization of reforms become stumbling blocks.”
Boyle said Democrats and the White House have drawn a line against the GOP-push for work requirements that could affect Medicaid eligibility.
“We as Democrats support work,” Boyle said. “What we don’t support is labeling a work requirement under the guise of (becoming) a backdoor way to turn people away from health care.”
Boyle also said the June 1 default deadline set by Treasury Secretary Janet Yellen is real and should keep negotiators focused.
“June 1 is very real,” Boyle said, acknowledging that financial analysts have suggested other possible dates as early as June as the X-date. “Do we really want to try our luck and have a situation where we think it’s June 3, and then all of a sudden we wake up on June 2, and we realize that the Treasury actually defaulted that morning? was?”
Boyle also criticized Wall Street analysts for assuming a deal would be struck to prevent a default.
“Unfortunately, the markets and a lot of people on Wall Street have convinced themselves that we’re going to get it right in time,” Boyle said. “I hope they’re right. I think it’s more likely they’re right, but they just don’t recognize the tremendous risk that it doesn’t come to fruition in time. They completely underestimate it. It’s dangerous.”
As for the chances of a default, Boyle described himself as nominally optimistic. He understands that default is possible.
“This is without a doubt the most serious risk we’ve faced since 2011,” Boyle said, referring to the initial debt ceiling showdown that led to a downgrade of the U.S. credit rating by Standard & Poor’s. A short decline occurred. “The odds that we predetermine — either by design or by accident — are significantly above 0. They’re below 50%. But they’re above zero.”
Boyle also ruled out the possibility that the Treasury Department could prioritize spending after going into default — essentially paying off some federal obligations but not others. That’s an idea some Republicans have floated.
“It’s a fairy tale,” Boyle said. “Magical thinking. There is no mechanism for prioritizing debt.”
Among the available offers, short of a negotiated solution, Boyle called a discharge petition known as “a long shot” and the use of the 14th Amendment as the “least bad option.”
Boyle has helped collect signatures from 213 Democrats for a discharge petition — a mechanism to force the minority party to vote to raise the debt ceiling to the floor. However, Boyle acknowledged that he needs five Republicans to sign the petition to initiate floor action. At this point, no Republicans are willing to cross the GOP leadership and sign the petition.
“It’s an unusual situation,” Boyle said of the search for Republican signatures. “As each day passes we get closer to the X date, the pressure builds exponentially. You get to May 30, you get to May 31, the sudden deadline can focus minds. I’ve always said that a discharge petition was a long shot. It’s an option. It’s there as an escape valve. I would urge (swing district Republicans) to be a hero to you and It’s an opportunity to sign this discharge petition and put an end to this potential disaster.”
Some Democrats have urged President Biden to use the 14th Amendment to continue paying down the U.S. debt — even without Congressional authorization, which, historically, is the means by which Congress and Republicans and Democrats Management has avoided default. Boyle said constitutional experts have told him that Mr. Biden could be vindicated, but when the inevitable lawsuits against exercising 14th Amendment powers are brought, the uncertainty will cause economic and reputational damage. Boyle thinks it should be preserved as “an option”.
“At the same time, I am a pragmatist and recognize that there will still be some loss. We will suffer economically,” he admitted. “People who buy our debt will have one question in their minds, they’ll think, ‘Hey, wait a minute, am I really going to get my money back?'”
Still, absent Del. Boyle said that using the 14th Amendment would be preferable to default.
“If you’re against the X-date, and there’s no deal going on and the president has made the request, that would be the least bad option to me,” Boyle said.
Boyle, however, declined to criticize Mr. Biden’s debt ceiling tactics or messaging, which some Democrats have recently faulted.
“I was literally one of Joe Biden’s early endorsers in Congress,” Boyle said. “It’s always easy to criticize what the White House does in terms of messaging. It’s important for all of us on the Democratic side to speak up as loudly as possible and call Kevin McCarthy on his repeated BS.”
Boyle said the so-called “BS” was McCarthy’s announcement that concessions House Republicans were willing to raise the debt ceiling — but only in conjunction with Democratic concessions on spending and other policies.
“They believe they’re giving up by not blowing up the American economy,” Boyle said. “This is extraordinary behavior. This is reckless. This is irresponsible. What Kevin McCarthy is really saying is that he is willing to put his political interests and those of his party ahead of the interests of the United States of America. Raise the normal and damn debt limit and, and don’t even deal with that nonsense.”
Executive Producer: Arden Farhi
Producers: Jamie Benson, Jacob Rosen, Sarah Cook and Eleanor Watson
CBSN Production: Eric Susann
Show email: TakeoutPodcast@cbsnews.com