Friday, July 19, 2019

What did Donald Trump do today?

He forgot his position on the debt ceiling.

The Constitution says that only Congress can authorize the borrowing of money against the United States' credit. For over a hundred years, there has been a pre-existing "debt limit" written into law by Congress, which can be raised as needed with further legislation. 

Often, appropriations bills authorize money to be spent that would require an increase in the debt limit. If the debt limit were not raised in these situations, the government would eventually default on its bond obligations. Because virtually the entire world is heavily invested in U.S. bonds, a default would trigger a worldwide financial catastrophe.

Today, Trump told reporters that the idea of using the statutory debt limit as leverage in negotiations with Congress was unthinkable. 

I can’t imagine anybody ever even thinking of using the debt ceiling as a negotiating wedge. When I first came into office I asked about the debt ceiling, and I understand debt ceilings, and I certainly understand the highest rated credit in history, and the debt ceiling, and I said, I remember, to Sen. Schumer and to Nancy Pelosi, "Would anybody ever use that to negotiate with?" And they said "absolutely not, that’s a sacred element of our country." They can’t use the debt ceiling to negotiate.

Trump doesn't understand debt ceilings as well as he thinks. Several times in recent history, Congress has pushed the nation to the brink of default by using the threat of default to force a president to sign other legislation. Most recently, in 2012-2013, the Republican-controlled Congress tried to use this tactic to get President Obama to effectively repeal the Affordable Care Act. They were encouraged by... Donald Trump.




There is some context for Trump's remarks today. The country will need a debt ceiling increase soon, but Congressional Democrats rejected a budget proposal from Trump that would raise it and tie Congress's hands for future appropriations.
 

Who cares?

  • Anything that could potentially wreck the entire world economy is something the President of the United States needs to be able to remember his position on.