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The Morning Dispatch: One Congressional Crisis Down, One to Go
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The Morning Dispatch: One Congressional Crisis Down, One to Go

Lawmakers have reached a deal to avoid a government shutdown, but are still at loggerheads over the debt ceiling.

Happy Thursday! Please pour one out for the tubercled-blossom pearly mussel, a species not seen since 1969, which the U.S. Fish & Wildlife Service formally proposed labeling extinct yesterday. Tubercled-blossom pearly mussel, we hardly knew ye.

Quick Hits: Today’s Top Stories

  • Fumio Kishida, Japan’s former foreign minister, is set to become the country’s prime minister next month after being elected leader of the ruling Liberal Democratic Party. Kishida will replace Yoshihide Suga, who announced a few weeks ago that he would step down after just one year on the job.

  • YouTube announced Wednesday that it is expanding its medical misinformation policies to include content about “currently administered” vaccines. “Specifically, content that falsely alleges that approved vaccines are dangerous and cause chronic health effects, claims that vaccines do not reduce transmission or contraction of disease, or contains misinformation on the substances contained in vaccines will be removed,” the company said.

  • Axios reported yesterday that Chairman of the Joint Chiefs Gen. Mark Milley “directly blamed the State Department for a botched evacuation from Afghanistan” in a classified briefing with senators this week, saying officials “waited too long” to order the operation out of Kabul’s airport.

  • Senate Majority Leader Chuck Schumer said late last night that lawmakers had reached an agreement to avoid a government shutdown and extend government funding until December 3, 2021. The Senate is expected to vote on the continuing resolution later this morning, but efforts to raise or suspend the debt ceiling before Treasury Secretary Janet Yellen’s October 18 deadline still face steep hurdles. 

  • Democratic Sen. Joe Manchin—whose vote Democrats need to pass any reconciliation package—reiterated Wednesday that he will not support a $3.5 trillion topline number, arguing it would be “fiscal insanity” to spend trillions on new government programs while the government struggles to pay for existing social programs and inflation is on the rise. His comments caused some House progressives to dig in deeper on their opposition to the bipartisan infrastructure bill Manchin helped negotiate.

  • Senate Parliamentarian Elizabeth MacDonough on Wednesday reportedly rejected Democrats’ second attempt to include immigration reform in the party’s multi-trillion dollar reconciliation package. Democratic Sen. Bob Menendez said negotiators “will go to plan C,” but Sen. Dick Durbin acknowledged the ruling left them with “limited” options.

  • The January 6 Select Committee issued a second slate of subpoenas on Wednesday, demanding testimony and records from 11 individuals “tied to the events and rallies leading up to the January 6th insurrection.”

Debt Ceiling Standoff Continues

(Kent Nishimura / Los Angeles Times via Getty Images.)

Congress is poised to pass legislation today to avert one catastrophe—a government shutdown at midnight—but a partisan standoff over the debt ceiling only intensified Wednesday in the face of an approaching deadline.

Senate Majority Leader Chuck Schumer said yesterday that he will not bow to Republican demands that he advance a debt ceiling hike on a partisan basis through the budget reconciliation process. 

“This body cannot and will not go through a drawn-out and unpredictable process sought by the minority leader,” he said on the floor.

House Speaker Nancy Pelosi likewise told reporters she has ruled out using reconciliation to address the debt limit.

The showdown has been months in the making, and the global economy hangs in the balance. Senate Republicans have been unambiguous about their position since July: They will not lend their votes to raise the debt ceiling, taking issue with the $3.5 trillion social spending package Democratic leaders hope to pass.

Democrats note that they helped raise the debt limit during former President Donald Trump’s administration. It’s also true that much of the debt in question was accrued under Trump, and Congress would need to hike the debt ceiling even if Democrats’ future spending plans were dropped altogether. But their protests have had no impact on congressional Republicans. 

“We have made it pretty clear that they have had the ability to do this themselves from day one,” Pennsylvania Sen. Pat Toomey told The Dispatch on Wednesday. “And that’s impossible to refute. So, how effective is that going to be to blame us?”

Democrats are able to pursue a debt ceiling hike through reconciliation, the process that circumvents the 60-vote threshold in the Senate. The longer congressional leaders wait to kickstart the process, though, the more difficult it will be for members to meet a mid-October deadline to avoid the Treasury Department’s first-ever default on its legal obligations.

Instead of taking initial steps to pursue a debt ceiling hike through the reconciliation process, Democrats in the House spent Wednesday voting on a largely symbolic standalone debt ceiling bill that they know will not pass the Senate. House Democrats approved a debt limit suspension through December 2022, with a vote of 219-212. One Republican, Rep. Adam Kinzinger, supported the bill. Two Democrats opposed it.

Ahead of the vote, Democratic leaders didn’t express much hope that their bill would persuade Republicans to reconsider.

“It would be a positive development if Republicans would adhere to their prior position that they held during the Trump administration, that a default is out of the question,” House Democratic Caucus Chair Hakeem Jeffries told reporters. “But unfortunately, Mitch McConnell and Kevin McCarthy are playing politics.”

Republican senators blocked legislation that included a debt limit suspension earlier this week.

Raising the debt ceiling is one of the primary uses of the budget reconciliation process. Democrats had the opportunity to raise the limit earlier this year when they approved a sweeping coronavirus relief package through reconciliation, but they opted against it at the time. (This February story from the Wall Street Journal’s Richard Rubin is worth looking back on today.)

Democrats didn’t include instructions to address the debt ceiling in their second budget, either. But the Senate parliamentarian issued an opinion earlier this year saying that previously adopted budgets can be revised under certain parameters. In this case, Democrats could revise their already-passed budget to include instructions to raise the debt limit. They would then be able to pass a debt ceiling increase without any Republican votes in the Senate. Democrats could do this in a separate bill—they would not have to do it as part of the larger $3.5 trillion Build Back Better package, which is not yet finalized.

This approach mandates an intensive floor debate and amendments process, which would not only take up time, but would also give Republicans the chance to offer amendments that Democrats may find politically inconvenient.

“If we had put raising the debt ceiling in the reconciliation instruction to begin with, we could do that,” Sen. Tim Kaine, a Virginia Democrat, told The Dispatch. “Having not put it in, I think it’s very difficult to go back and amend the reconciliation instruction.”

And Hawaii Sen. Mazie Hirono told reporters she “would describe it as a hellacious process” and Republicans “will try to subvert it every chance they get.” 

The Treasury Department has been using “extraordinary measures” to pay its obligations since the debt ceiling came back into effect in August after being suspended for two years. Those measures are expected to run out around October 18, according to Treasury Secretary Janet Yellen. 

Republican Sen. John Barrasso said Wednesday that there is still enough time for Democrats to pursue a debt limit hike through reconciliation. 

“They’ve had two months to work on this,” he said. “They can get this done. There’s a way to do it. There’s plenty of time to do it.”

Worth Your Time

  • In The Atlantic, Morgan Ome and Christian Paz write about a strange, burgeoning social media trend among young people: nostalgia for the earliest days of the pandemic. Using music and pop culture references associated with March and April 2020—remember Tiger King?—content creators are racking up millions of views tapping into their peers’ fond recollections of a time where the world seemed more united in the face of a common threat. “We were just feeling nostalgic for this period of time where we felt such togetherness, even though we were physically isolated. And I feel like that has dissipated over the past year and a half,” one user said. “Why do these videos resonate? According to David Newman, a researcher at UC San Francisco, nostalgia is a natural response to uncertainty and dissatisfaction. … In Newman’s studies on nostalgia, he has found that on a day-to-day basis, most people feel nostalgic when they’re also feeling lonely or isolated. Whether because of the return of masks, electoral turmoil, or the recent Delta surge, people may be longing for a time when the gravity of the situation hadn’t fully set in. As time passes, we may forget negative memories and hold on to the positive ones, Newman and other psychology experts told us.”

  • Jack Butler—of “No you won’t, this is a podcast” fame—has a new essay out in National Review pushing back on a recent piece from Robert Kagan that argues the Republican Party is pushing the country toward its “greatest political and constitutional crisis” since the Civil War. “To understand Kagan, it is first necessary to understand what legitimate points he makes,” Butler writes, conceding that former President Donald Trump’s post-election behavior was despicable. But, as the NRO headline reads, Republicans don’t need to “do everything that Democrats want” in order to save democracy. “The common thread here is an inability to separate legitimate political action and interest from subversion of the republic, and a deliberate attempt to blur the lines between the two so that they can be condemned as one. That Kagan would make such an attempt indicates either that he does not actually see this crisis as being as serious as he wants you to think (as otherwise he might consider offering more than token concessions to erstwhile political opponents interested in acting in good faith on this issue), or that he is incapable of rising above his partisan station to meet it.”

  • Tyler Cowen pointed something interesting out in his Bloomberg column on Wednesday: Democrats aren’t really making a proactive policy argument in favor of their $3.5 trillion reconciliation plan. “Crazy as my hypothesis may seem, given all the stuff about Biden’s agenda on the internet, there has been remarkably little policy debate about it, and remarkably little attempt to persuade the American public that this spending is a good idea,” he writes. “My colleague Arnold Kling put it well: ‘With the reconciliation bill, there is no attempt to convince the public that it is desirable to enact an enormous child tax credit or to mandate ending use of fossil fuels in a decade. Instead, what we read is that if you’re on the blue team you want the number to be 3.5, but a few Democrats are holding out for something lower.’”

  • Peter Suderman took the Biden administration’s reconciliation sleight of hand to task in his latest for Reason. “The simplest way to understand economics is that it is a reckoning with unavoidable tradeoffs. If you spend money on something, you may obtain something in return—but you lose the ability to use those resources on something else,” he writes. “Under President Joe Biden, however, Democrats in Washington have decided that they can simply wish those tradeoffs away by declaring that they do not exist. Over and over again, they have argued that their policies do not or should not have any costs whatsoever.” The reconciliation package, for example, “is a plan that, in its broadest form, calls for spending $3.5 trillion. Even in the unlikely event that such a plan turns out to be truly fully paid for, it would still spend $3.5 trillion. Those economic resources would be used to do some specific things, which in turn would reduce the ability to do other things. In other words, there would be costs and tradeoffs.” 

Presented Without Comment

Also Presented Without Comment

Also Also Presented Without Comment

Toeing the Company Line

  • On this week’s Dispatch Podcast, Steve, Jonah, and David discuss the past two days’ hearings on Afghanistan withdrawal, Democrats’ make-or-break week in Congress, and how worried Americans should be about democratic norms and the future of the Republican Party.

  • Jonah’s been watching some Schoolhouse Rock—and it has him down on the state of our politics. “‘I’m Just a Bill’ was literally my introduction to how laws get made,” he writes in the Wednesday G-File (🔒). “The only problem is, it’s not really how laws get made anymore. Oh, sure, some are made that way. But for the most part, congressional leaders, i.e. the speaker, decide behind closed doors what the legislation should be and then instruct the majority how to vote.”

  • Populists are increasingly pointing to the “industrial policy successes” of countries like Japan, Taiwan, South Korea, and China as a way to make the case for more government intervention in the economy here in the United States. Scott Lincicome isn’t convinced. “Although we commonly hear that industrial policy successes abroad justify U.S. proposals like semiconductor subsidies, ‘green energy’ loans, and ‘strategic investments’ in ‘critical industries,’ caution is warranted,” he writes in yesterday’s Capitolism (🔒). “While there may be some discrete benefits for certain workers or firms, they’re outweighed by the broader economic harms (even in the targeted industry!), and the gains would’ve been even better under a freer, less-interventionist policy regime.”

Let Us Know

Despite all the chaos up on Capitol Hill this week, lawmakers were still able to come together last night for the annual Congressional Baseball Game. Republicans won the matchup for the first time since 2016 by a score of 13 to 12.

This got us wondering—are there other ways we can involve athletics in the legislative process and maybe get the Capitol to function a little better?

Reporting by Declan Garvey (@declanpgarvey), Andrew Egger (@EggerDC), Charlotte Lawson (@lawsonreports), Audrey Fahlberg (@AudreyFahlberg), Ryan Brown (@RyanP_Brown), Harvest Prude (@HarvestPrude), and Steve Hayes (@stephenfhayes).