Here’s a story from this week that you likely won’t hear much about, what with the 24/7 cable news screamfest over the Trump-Squad wars: The White House announced that its 2019 federal deficit projection has been revised upward to the symbolic $1-trillion threshold.
To accommodate this irresponsibility, Treasury Secretary Steven Mnuchin and House Speaker Nancy Pelosi (D-Calif.) are quietly negotiating the increase or even removal of that once-controversial artifact: the debt ceiling.
Mnuchin maintains, probably with some hyperbole, that the country faces default in September unless Congress raises the $22-trillion debt limit the country already blew through in March. (Treasury has been taking various emergency measures to patch the fiscal ship of state since then.)
Pelosi counters that in exchange for Democratic support, she wants a two-year budget deal that jacks up discretionary domestic spending. If recent history is any judge, the two will likely dance around each other for a while, then agree to spend and borrow trillions more.
Notice what is not on the table, despite a GOP administration: reining in federal spending, whether next year or next decade. What a difference a little power makes.
When a Democrat held the White House, the debt ceiling was the Republicans’ favorite tool for forcing conversations about spending caps and long-term entitlements. It dominated the national political headlines from 2011-2014.
Now, particularly under a president who won a competitive primary by trashing traditional conservative notions of trimming the welfare state, Republicans are treating the borrowing limit as a momentary irritant, to be waved off as politically necessary.
The flight from fiscal rectitude pre-dated the rise of Trump. As soon as Republicans re-took control of the Senate in November 2014, new Majority Leader Mitch McConnell (R-Ky.) said: “Let me make it clear: There will be no government shutdowns and no default on the national debt.” So much for the previous four years of political conflict.
Back then, fiscally conservative members of the tea party movement still had enough self-respect to call out their free-spending colleagues. In March 2015, then-Rep. Mick Mulvaney, a founding member of the recently formed, deficit-hawkish Freedom Caucus, wrote a Wall Street Journal op-ed headlined: “The Republican Budget Is a Deficit Bust,” arguing, “There is no honest way to justify not paying for spending, no matter how often my fellow Republicans try.”
Less than three years later, as a power-accruing member of the Trump administration, Mulvaney declared that “We need to have new deficits.” Well, mission accomplished.
The Congressional Budget Office last month once again called the country’s long-term fiscal trajectory unsustainable, warning that any meaningful rise in interest rates could trigger a global financial crisis. We will soon top even World War II records for debt as a percentage of GDP; annual debt service will likely eclipse military spending during the next presidency, and Medicare is on pace for forced benefit cuts by as early as 2026. All this during the late stages of a near decade-long economic expansion.
So what are the deficit hawks at the Freedom Caucus doing nowadays? Criticizing co-founder (and now defector) Rep. Justin Amash (I-Mich.) for daring to criticize Trump.
The president is certainly onto something when he says, whenever asked about the looming debt crunch, “Yeah, but I won’t be here.” Sadly, though, the rest of us will be.
And here’s where things get worse. As Mulvaney warned in 2015, Republicans from 2011 through 2014 “were gaining the moral high ground on spending,” but with new increases “we lost it, and it will be harder to regain the next time.” No one will soon believe Republicans next time they cry about President Elizabeth Warren’s mammoth new spending plans.
Americans received a telegram from that lost world of conservative deficit-hawkery on Tuesday, when former South Carolina congressman and governor Mark Sanford said he was considering a challenge to Trump for the Republican presidential nomination. “I think the Republican Party has lost its way on debt, spending and financial matters,” Sanford told the Post and Courier.
So will Sanford be the flicker that causes the GOP to reignite its sense of fiscal sanity? Bet your life savings against it. Not only are we living in a time when one of the most influential conservative media figures, Tucker Carlson, is singing the praises of Warren’s economic ideas; there’s the not-insignificant matter of Trump himself.
The Republican Party already has a primary challenger to the president who talks in every speech about debt and deficits, fiscal rectitude and long-term entitlement fixes. And Bill Weld is being outpolled by an average of more than 70 percentage points, while being outfundraised by Trump 150 to 1. There may be a place for deficit hawks in American politics, but it’s not in the Republican Party.
Matt Welch is editor at large at Reason magazine and a contributing writer to Opinion.