Wednesday, May 24, 2017

What did Donald Trump do today?

He urged Congress to increase the debt ceiling immediately--or rather, his economic advisors did.

Both Mick Mulvaney, Trump's budget director, and his Treasury Secretary Steven Mnuchin told Congressional committees that it was urgent to raise the debt ceiling before a government default occurred in October or November. Both cited lower-than-expected tax receipts as a reason for the added urgency.

Trump's subordinates are correct that a default on US government debt--which is regarded as among the safest investments in the world--would be catastrophic for the US and world economy. Raising it has no effect on the amount of money Congress can spend; it would only permit borrowing to cover appropriations that Trump has already signed into law. However, it was not clear whether Mulvaney and Mnuchin were speaking for Trump himself, given his previous statements on the subject:

Why does this matter?

  •  It's bad if a president only wants to do sensible things when it's politically convenient.