As the nation races toward another budgetary crisis next month, Republican leaders are using the prospect of a government shutdown and the need to raise the nation’s debt ceiling as leverage points to undermine the Affordable Care Act — just days before uninsured Americans are expected to sign up for health care coverage — and extract additional cuts to government programs.
Past Congresses have used the debt ceiling as a “vehicle for other legislative matters” or nongermane amendments, but as the timeline below demonstrates, the Republicans that came to power after the 2010 midterm elections demanded something entirely different: they threatened to push the nation into default and shut down the government unless Congress approves deep structural budget cuts during a period of economic recession.
In November of 2010, GOP leaders informally polled the incoming freshman and were surprised to discover that “all but four of them said they would vote against raising the ceiling, under any circumstances.” This response was the result of what the Washington Post described as a “natural outgrowth of a years-long effort” by GOP recruiters to build a new majority with uncompromising anti-tax, anti-spending candidates and it effectively hamstrung Republican leaders from accepting any kind of budgetary compromise from the Obama administration. As a result, House Speaker John Boehner (R-OH) and House Majority Leader Eric Cantor (R-VA) walked away from so-called grand bargains with the White House at least twice and have since adopted the same kind of uncompromising rhetoric that’s known to animate political campaigns, not actual governance.
Though Congress has already enacted approximately $2.4 trillion in deficit reduction since the start of fiscal year 2011 — 72 percent of the savings have come through spending cuts — the deficit has fallen to the lowest level since 2008, and inflation-adjusted discretionary spending is now below the final two fiscal years of the Bush administration, Republicans keep holding the debt ceiling and continuing resolution hostage, to achieve more cuts. Here is how we got here:
FEB 4: Congress votes to increase the nation’s borrowing limit — a vote it had taken 40 times in the past three decades. Republicans increased the debt ceiling 19 times during the presidency of George W. Bush, raising the nation’s limit by nearly $4 trillion.
Martha Roby, who will go on to represent Alabama in Congress, issues a statement condemning the vote. “This ‘need’ to raise the debt ceiling is caused by one thing: out-of-control spending in Washington,” she says. Reid Ribble, a soon-to-be Congressman from Wisconsin, agrees, “This Congress has done nothing but spend future generations of this country into a black hole.”
SEP 10: Speaking at the Faith & Freedom Conference, Rep. Lynn Westmoreland (R-GA) tells the crowd, “The government shut down…That’s what I wanted to hear! A good clap for that!” “We want you with us,” says Westmoreland. “We gotta have you there. Because they’re going to come and say, ‘Daddy can’t go to the VA, the national parks are closed’ … we need to make sure you’re going to be with us.”
SEP 30: With the fiscal year ending and the 2011 budget not yet adopted, Congress passes an extension –- known as a continuing resolution –- to keep the government running under existing spending levels until Dec. 3.
NOV: Republicans vow to cut $100 billion from the 2011 budget during the mid-term elections and win back control of the House. Initially, Boehner seems hesitant to use the debt ceiling as leverage to achieve the cuts. “I’ve made it pretty clear to them that as we get into next year, it’s pretty clear that Congress is going to have to deal with” the debt limit, Boehner told reporters on Nov. 19. “We’re going to have to deal with it as adults. Whether we like it or not, the federal government has obligations, and we have obligations on our part.”
DEC: Alarmed by growing talk from Republicans about taking the debt ceiling hostage to achieve spending cuts, the White House tries to increase the borrowing limit as part of a tax package that passed Congress, but the effort fails. “I’ll take John Boehner at his word — that nobody, Democrat or Republican, is willing to see the full faith and credit of the United States government collapse,” Obama says at an end-of-the year press conference. “Once John Boehner is sworn in as speaker, then he’s going to have responsibilities to govern. You can’t just stand on the sidelines and be a bomb thrower.”
DEC 2-21: Unable to pass a spending bill, Congress enacts four different continuing resolutions to keep the government running until March 4. These appropriations cut the Congressional Budget Office’s projection of discretionary spending from 2013 through 2022 by more than $400 billion.
JAN: At a closed-door retreat at a Marriott in Baltimore’s Inner Harbor, just days after taking power, House Majority Leader Eric Cantor (R-VA) promises to use the debt ceiling as leverage to achieve spending cuts.
“I’m asking you to look at a potential increase in the debt limit as a leverage moment when the White House and President Obama will have to deal with us,” he says. “Either we stick together and demonstrate that we’re a team that will fight for and stand by our principles, or we will lose that leverage.”
FEB: Paul Ryan announces that Republicans will seek a budget for FY 2011 with $35 billion in budget cuts, far less than the $100 billion in cuts that House Republicans had promised. Later that month, the House passes $61 billion in cuts for the remainder of FY 2011, “the amount that would remain to be slashed had a $100 billion cut been applied to the full-year budget.”
MARCH 2: Congress passes a short-term resolution extending operations to March 18. Spending is cut by $4 billion.
MARCH 16-17: Congress approves yet another continuing resolution extending federal operations through April 8. Spending is cut by $6 billion.
APRIL 4: House Republicans “gave the speaker an ovation” when he informed them that he was advising the House Administration Committee to begin preparing for a possible shutdown. That process included alerting lawmakers and senior staff about which employees would not report to work if no agreement is reached.
APRIL 14: Shortly before 11 pm, Boehner announced that he has agreed to support a seventh short-term extension, funding the government through Sep. 30. Spending is cut by $38 billion, but budget analysts reported that the plan would reduce actual spending in the current year by only $350 million.
JUNE-AUG: House leaders try to convince their caucus of the dangers of defaulting on the debt ceiling. “Leaders like me would try to tell them: Look, no, really, we think it could be bad,” Ryan says. “They’d look at it with suspicion …If there was any semi-credible source saying default wouldn’t be so bad, they clung to that.”
AUG: At the last minute, Congress passes the Budget Control Act, increasing the debt ceiling immediately by $400 billion, then by another $500 billion after September. The measure cuts $2.4 trillion over 10 years and establishes a Super Committee to recommend a deficit-reduction package by Thanksgiving 2011. If the committee fails, automatic cuts worth $1.2 trillion are automatically triggered. After deep cuts are enacted by the end of the year, the debt ceiling will increase by another $1.2 trillion to $1.5 trillion, covering the Treasury’s borrowing needs until 2013. Ryan boasts that Republicans won two-thirds of the cuts to discretionary spending that they wanted.
AUG 5: Standard & Poor’s issues the first downgrade of the nation’s credit rating, saying the “political brinkmanship of recent months” had shown evidence of “America’s governance and policymaking becoming less stable, less effective, and less predictable.” This costs the country a million jobs and $19 billion.
SEP: Congress passes a continuing resolution through March of 2013. The government is funded at an annual rate of $1.047 trillion, consistent with the cap set by the Budget Control Act.
JAN 2: Congress passes the American Taxpayers’ Relief Act. The measure makes permanent most of the Bush tax cuts.The Act also reduces deficits over the next 10 years by about $750 billion: $630 billion comes from revenue increases, approximately $30 billion comes from programmatic spending cuts, and the rest from interest savings resulting from lower deficits.
The measure also postpones automatic cuts for two months, until March 1, 2013. An increase in the debt ceiling is not included.
JAN: Congress agreed to suspend the debt ceiling without additional program cuts –- but only through May 2013.
MARCH 1: The sequester begins to take effect at the end of the two-month delay under ATRA. Democrats have called for a balanced package of revenue increases and spending cuts to replace the sequester, while Republican congressional leadership has stated that deficit reduction must come solely from cuts.
MARCH 21: Congress approved an appropriations bill to fund government operations through the remainder of fiscal year 2013, which largely maintains low current funding levels –- further reduced by $85 billion in cuts from the sequester.
JULY: Sens. Mike Lee (UT), Ted Cruz (TX), and Rand Paul (TX) circulate a letter warning they will not approve any spending measure to keep the government operating “if it devotes a penny” to Obamacare. The letter is signed by Sens. John Cornyn (TX), John Thune (SD), and Marco Rubio (FL).
AUG 22: Eighty members of the House Republican conference sign on to a letter sent to Republican leaders “demanding that any spending bill that reaches the House floor be free of funds to implement or enforce the president’s healthcare reform law.”
AUG 26: The Treasury Department announces that the nation will hit the debt ceiling by mid-October.
SEP 30, 2013: Fiscal year 2013 ends. Congress and the President must agree on appropriations for fiscal year 2014 by September 30 so the government can function when the new year begins on October 1, 2013.
By Igor Volsky