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The debt ceiling agreement that was reached over the weekend by negotiators for President Joe Biden and House Speaker Kevin McCarthy is being denounced by partisans at each end of the political spectrum. This likely means that each side made significant concessions in the negotiations to win the support of moderate members from each political party.
We are thankful that an agreement was reached and are hopeful that a sufficient number of members of Congress will support it so we can avoid what could have been an economic catastrophe. We don’t claim to be all that knowledgeable about what exactly would happen if legislation isn’t enacted to raise the debt ceiling by next week’s deadline, but we trust the economic experts who say the consequences would be dire.
The bipartisan agreement reached by negotiators appears to represent a reasonable compromise. Each side got a little of what it wanted and conceded some of what it didn’t want. Republicans got spending reductions, though not of the magnitude that they had hoped. Democrats were able to keep key provisions of the Inflation Reduction Act intact that should lead to major inroads into combating climate change.
Sen. Joe Manchin of West Virginia appears to once again be playing a key role in negotiations to get major legislation passed. The conservative Democrat from a Republican-dominated state is getting assurances that construction of his long-desired (and longdelayed) natural gas pipeline will be completed. The legislation includes provisions to expedite permit approvals so that the 300-mile Mountain Valley Pipeline from West Virginia to eastern Virginia could become a reality, perhaps by the end of this year.
The legislation leaves intact funding levels for Social Security, Medicare and the military while making inflation-adjusted reductions in direct spending on other domestic programs. It’s estimated that federal spending would decline by $55 billion next year and $81 billion the following year. The $80 billion that was included in the Inflation Reduction Act for the Internal Revenue Service to step up enforcement of tax laws was reduced by $20 billion.
Work requirements are to increase for some recipients of food stamps and welfare assistance. The legislation would officially end the pause on student loan repayments at the end of August but does not alter the president’s plan to cancel up to $20,000 in individual student debt. That plan’s fate is in the hands of the U.S. Supreme Court.
The legislation that Congress must pass by Monday, June 5, suspends the debt ceiling for two years, until January of 2025, after the next presidential election. That means we will likely be back where we are now in two years, unless we no longer have divided government. If one party controls both houses of Congress and the presidency after the 2024 elections, there would likely be sufficient agreement among the two branches of government to avoid another debt ceiling crisis.
For now, we urge our congressman, Ben Cline, and our two U.S. senators, Mark Warner and Tim Kaine, to cast their votes in favor of this reasonable bipartisan compromise.
