Get ready for an eyes-glazed-over week of politics and process. But this DC sausage-making has implications for virtually every American family. What’s happening right now is nothing less than a once-in-a-generation re-alignment of your kitchen table economics.
Democrats hail it as the most meaningful expansion of the safety net since LBJ’s Great Society or FDR’s New Deal. Republicans hate it for the same reason.
Republicans oppose the tax hikes to pay for it and the scope of the social spending. And among Democrats there is some infighting over process and size.
Some Democrats in high-tax states insist on reinstating state and local tax (SALT) deductions. And some progressives may balk if moderate Democrats succeed in watering down the corporate tax hikes or the size of the package.
Republicans are so opposed to Democrats’ social agenda, they vow not to help raise the debt ceiling. On CNN’s State of the Union, Sen. Pat Toomey said Democrats are in the midst of “a very damaging spending spree on a scale that we have never seen, and they want us to come along and authorize the borrowing to help pay for it.” He vowed the ceiling would need to be raised by Democrats alone.
Even an accidental short default could spark a financial crisis, cost the government billions more in borrowing costs and potentially spike interest rates for the rest of us.
“Debt default is a serious issue,” says Valliere, but Wall Street players so far are betting the debt ceiling will be resolved.
“It will get raised eventually with Democrats forced to take most of the ownership,” Valliere says.
The administration believes there are much-needed investments in the power grid, clean water, airports, seaports, high speed internet, public transportation, and EV charging stations. It’s a simple intelligence test for Washington, with broad popular support, wrapped up in DC’s hell week.