As the nation faced the possibility of catastrophic default over House Republicans’ manufactured crisis—threatening not to raise the federal debt ceiling—President Biden and House Speaker Kevin McCarthy negotiated a budget deal, that was signed into law on June 3. The agreement exclusively mandated program cuts rather than increasing revenue by closing tax loopholes that benefit the wealthiest Americans and profitable corporations.
The deal, which suspends the nation’s borrowing limit until Jan. 2025, limits non-defense discretionary spending to 1 percent annual growth, claws back $28 billion in unspent COVID-19 relief funds and imposes new work requirements for SNAP food stamp recipients up to 55 years old. The agreement also eliminates $1.4 billion in IRS funding, restarts federal student loan payments for 43 million Americans, increases the Pentagon budget to a record $886 billion and fast tracks the long-stalled and controversial Mountain Valley Pipeline in West Virginia and Virginia.
Between The Lines’ Scott Harris spoke with Will Rice, policy consultant with Americans for Tax Fairness, who assesses the winners and losers in the debt ceiling budget deal and his group’s opposition to the GOP plan to make permanent expiring provisions of the 2017 Trump era tax cuts that primarily benefit the rich and corporate America.
WILL RICE: This was supposed to be a negotiation, but Republicans refused to talk about raising revenue, which usually if you’re trying to close the gap, a budget cap, you at least talk about revenue and don’t focus entirely on what you’re spending.
So I think the American people were losers, although I have to say that I’m pleased that President Biden negotiated this deal, which was much better than it could have been. A lot of important programs like Social Security, Medicare, Medicaid were spared. So it was not as bad as it could have been, but it still was not a good deal.
The food stamp requirement you mentioned, it’s now called Supplemental Nutrition Assistance Program or SNAP, do work. And there already are work requirements in states prior to this. Somewhat older adults, those between 50 and 54, were not required to either be working or looking for work or in some sort of educational program or structured volunteer program. And now they are.
The studies have shown over and over again that these work requirements, what they do is they just throw up red tape impediments to people getting this food aid. It doesn’t actually inspire or help anyone get a job or keep a job. So it’s really kind of a backdoor way of denying people these benefits.
I think when people hear work requirements, it sounds pretty reasonable, but that’s just the title they’ve given to what’s really an attempt to block people from getting this aid that they need. I think that the real division here, if we go beyond this particular deal, is that Republicans seem to be saying “We’re spending too much money, specifically on people. Not on the defense budget,” as you mentioned.
But if you look around and see the degree of homelessness, you see even after the Affordable Care Act, tens of millions of people without health insurance, people not having long-term insurance, how low the savings rate is, how few people have a secure retirement in front of them.
We’re not overspending on those things, obviously. So that’s even more of a reason to turn your eyes towards revenue, not only from rich people and from corporations, not only as a source of revenue, but if you see their lives and how they’re doing, the contrast is quite stark.
So that’s why I say it was a better deal than it could have been, but it was all being played in the wrong field, I think, which was on the theory that we have enough revenue, we’re spending too much. Our organization and I think a lot of people in the progressive community believe that we’re not spending enough, at least in the right places and we’re also not raising enough revenue to pay for that.
SCOTT HARRIS: How can we as a country, eliminate future hostage takings and extortion by the Republicans over the debt ceiling? Is legislation possible to end it once and for all? As I understand it, we’re the only nation in the world that debates whether or not to pay our bills.
WILL RICE: I think they should do away with the debt ceiling. Absolutely. I think most members of Congress, most Democrats are probably a little frightened to put that forward because they know the ads will be run against them by the Republicans. But it’s a crazy way to run a government. All it does is manufacture a crisis in a town that already has enough crises.
My understanding is it could be done away with a simple majority vote in both houses of Congress.
SCOTT HARRIS: Now that the debt ceiling crisis is behind us, the Republicans now plan to introduce legislation to make expiring portions of the Trump tax cuts that primarily benefited the nation’s richest people and most profitable corporations permanent. What can progressive Democrats, President Biden and people concerned about the inequities in our tax system do to not just stop the GOP from making these tax cuts permanent, but repeal them entirely?
WILL RICE: You’re right that they are now turning to the Trump tax cuts. This is a law that was passed back in 2017 and it completely puts the lie to the Republican claim that they’re worried about too much debt because they’re trying to extend expired and expiring provisions of this law that would add over $3 trillion to the national debt over ten years.
And as you as you mentioned, this is a law that overwhelmingly benefited the rich and corporations. And all the money that the Republicans saved by capping — and in some cases reducing what’s spent on domestic programs — they’re turning around and handing out to the wealthy, basically. So they cut those programs not to reduce federal debt, but to take the money and hand it to the already wealthy.
For more analysis and commentary on the debt ceiling visit Americans for Tax Fairness at
americansfortaxfairness.org.
Listen to Scott Harris’ in-depth interview with Will Rice (27:21) and see more articles and opinion pieces in the Related Links section of this page.
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