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Government Shutdown Season Is Different From Debt Ceiling Season: A Handy Wonkette Guide
'I demand that you shoot me now!'
Can you believe it's already Possible Government Shutdown Time again? But wait, you might ask yourself, didn't we just go through that big fuss where the Republicans were trying to play chicken with defaulting on the debt, which could tank the economy, and the Senate had to temporarily pretend the filibuster didn't exist so Democrats could take all the blame for doing it on their own? And then we wouldn't have to think about it again until after the midterms?
Well sure, that happened, but it was the "Debt Ceiling," not "funding the government." It's easy to mix the two up, since they both involve seemingly arbitrary deadlines that Congress has to meet in order to prevent Bad Consequences, but they're different things, and Rebecca said I could only write about the current thing today if I explained the difference.
First, the News-news: Congressional Democrats are fixing up a bill to fund the government for the rest of the fiscal year (September 30), which is one of Congress's main jobs. The goal is to get that bill written and passed before February 18, to prevent a government shutdown. Instead of doing a "continuing resolution" that would just keep all parts of the government funded at current levels, the bill should be an "omnibus spending bill" that funds all the non-defense parts of the government with new funding levels (the defense spending bill was already passed back in December, as you may vaguely recall in your 2021-addled brain).
Democratic and Republican leaders have been meeting this week to work out what exactly will go into the bill, and the indications so far are that we probably won't see any sort of drama that might result in a government shutdown. That said, two weeks is a long time in politics, so by the deadline of February 18, maybe all the Republicans will decide to threaten a government shutdown unless Joe Biden nominates Donald J. Trump to be on the Supreme Court. It seems unlikely, though.
Simply put,"funding the government"involves Congress passing a bill (or bills) that will spend money to do all the stuff government does: keep the Navy afloat, process your tax refund, send money to Pennsylvania to spend on fixing bridges, and of coursedevelop Border Patrol Deathbots. When those funding authorizations run out, or when Congress can't agree to authorize more spending, the government has to partially shut down, because technically it has no money to run on. (In reality, "essential workers" keep working, but with no pay, which sucks for them, and it's even worse for employees of government contractors, who can't even be sure of keeping their jobs, or collecting back pay if they do.)
The Debt Ceiling (or Debt Limit)is an arbitrary cap on how much the US government can borrow to actually pay for all the spending it authorizes, not only in any given fiscal year, but also for payment on the national debt. Historically the government brings in less in revenue than it spends, so it has to borrow.
Even in years when the government has a balanced budget or runs a surplus (like for five minutes back in the Clinton administration), the debt ceiling still needs to be raised, because the national debt is still there waiting to be paid down, which it never will be. Despite politicians' disingenuous comparisons to a family budget, a big national debt is neither a moral failing nor a financial disaster waiting to happen. Your family can't issue government bonds, for starters.
Let us now go into a bit more depth.
Debt Ceiling: A Stupid Idea We Should Get Rid Of
Why does the government have to give itself permission to borrow money to cover spending that it's already authorized? Isn't that terribly redundant? Couldn't we just borrow as we go?
As Rachel Maddow 'splainered last September, the debt ceiling is a legacy of World War I. Congress would only agree to authorize the huge amounts of money needed to send the USA into the war in Europe if there was also a hard limit to how much the US could borrow to fund the war effort. That debt limit was basically a sop to congressional isolationists who fretted that Woodrow Wilson and Congress would pile up endless debt to fund a forever war. But the law also allowed Congress to raise or suspend the debt limit as needed, essentially making it a useless, symbolic pretense at limiting federal borrowing. As Maddow put it, the debt limit
doesn`t constrain US government spending in any meaningful way at all. It just gives Congress something to do that they have to do every so often, because if they don't, the most [important] country in the world economy will default on its debt, we'll fling ourselves into a fiery self-imposed financial train crash for no substantive reason other than the fact that nobody ever thought to turn off this stupid thing that we turned on in 1917.
The main thing people forget about the debt limit is that it applies to borrowing to cover spending that Congress has already done . If Congress doesn't raise or suspend the debt limit, that doesn't make the federal debt go away. The US would default on its payments, which would downgrade the rating of government bonds, which would make borrowing money more costly, and would crash the world's economy, because everybody likes US debt as an investment. We've never defaulted, after all!
If we did, we'd have financial havoc and every bit as much debt as before. Which is why increasing or suspending the debt limit has to be done. During Donald Trump's term, you never heard much about the debt ceiling, because Republicans quietly suspended it several times while he was in office. Democrats voted yes too, because they are grownups who didn't want to crash the economy.
Now that a Democrat is president, of course, Republican politicians are happy to mislead folks about the debt limit, because nobody reads long explainers like this. It's remarkably easy to say "I will not allow more wasteful spending and debt!" and make a show of voting against raising the debt limit, because there's little political penalty for lying like that. And if the economy did crash, that would be Joe Biden's fault anyway, because he was president.
In December, Congress came up with a deal in which Senate Republicans agreed to let Democrats pass a one-year increase in the debt limit, with no filibuster, so that issue is done until sometime after this November's midterms.
Let's Fund Us A Government!
In comparison to the pure pointlessness of the debt limit, which doesn't really limit debt, at least periodic spending bills do something, at least with the portion of federal spending that's "discretionary": Congress authorizes spending to do the work of government, as well as taxes and other revenues to pay for it. Money is collected from taxes and fees (and borrowing, and from change collected from Pentagon couch cushions), and then the money gets spent, the bridges get repaired, and the air traffic controllers get paid. Maybe their radar and computer systems even get upgraded.
Whenever the end date of such authorization bills arrives without a new spending authorization being passed and signed into law, the government partly shuts down; the last shutdown we had was in 2018, when Donald Trump had a tantrum about funding for WALL and didn't get what he wanted anyway.
(There's also mandatory spending, or "entitlements," like Social Security or Medicare, that has its own tax base — payroll taxes mostly — and that happens without Congress having to reauthorize it every year. We won't get into that here.)
In Olden Times, Congress would usually do all this in a dozen spending bills, one for each of the 12 appropriations subcommittees in the House. Each bill would authorize a year's worth of funding for the corresponding government agencies.
That's still the case for some spending, like the annual defense authorization bill . But in recent decades, actually reaching agreement on a dozen separate budget bills has become so difficult that previous years' appropriations expire before the new bills are passed, so Congress punts, either with a short term continuing resolution that funds the entire government at the previous level, or with an omnibus spending bill that authorizes spending for great big chunks of government that didn't get their own authorizations.
That's where we are right now! Congress passed continuing resolutions in September and again in December, which funded the government at fiscal 2021 levels through February 18, and now the goal is to pass an omnibus bill that will fund the whole shootin' match at new levels through at least September 30. Then the whole glorious cycle starts again!
We hope this has made some kind of sense to you. We would explain how to fix all this, except we're way past deadline and also we don't have the slightest idea. We'll keep you updated on how the omnibus spending bill negotiations go, especially if Ted Cruz decides the government must shut down unless the January 6 investigation is defunded.
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