As the country moves ever closer to defaulting on its $31 trillion national debt, President Joe Biden continues to call on Congress to raise the debt ceiling and stave off a fiscal crisis.
But U.S. House Speaker Kevin McCarthy and the Republican majority he leads insist they won’t go along unless there are spending cuts included in a deal. They haven’t, however, said what exactly they want to see.
But U.S. Rep. Jared Golden, a three-term Lewiston Democrat with a penchant for breaking with his party’s leaders, took to Substack recently to lay out his vision of how best to cope with what he says is a real and growing problem.
The co-chair of the Blue Dog Coalition, which has long attracted fiscally conservative Democrats, called on Biden and McCarthy to cut a two-year deal that would establish the bottom line for the next two federal fiscal year budgets, leaving the details of how to divvy up the money to the normal congressional process.
Once they have an agreement, Golden said, Congress could raise the debt limit in tandem with the budgeting process to make sure politicians stick to the numbers they endorse.
Golden’s proposal is getting some attention.
Maya MacGuineas, president of the Committee for a Responsible Federal Budget, said in a written statement the Maine lawmaker “has it absolutely right: it is reckless to hold the debt ceiling hostage, and it is also reckless to ignore the threats of our growing debt.”
“Good for Congressman Golden for contributing to a much-needed discussion by releasing this framework,” she said, and for “focusing on policy rather than politics, and producing thoughtful ideas to begin tackling our crippling national debt.”
“His fiscal goal is reasonable and realistic, and he treats the issue with the honesty and nuance it deserves. If only more politicians were willing to do the same,” she said.
Golden said in his letter to constituents published April 14 on Substack that Biden’s strategy “is to enter into a standoff believing enough Republicans will cave under pressure.”
He said, though, that if GOP members, who hold a narrow majority in the House, “don’t blink and the nation defaults, Democrats’ condemnations of the GOP are unlikely to resonate with a public that is suffering the consequences of default. This would be an abject failure, and neither Congress nor the White House would escape blame.”
Golden said McCarthy “also isn’t showing any leadership for the country.”
“By holding the debt ceiling hostage,” the Maine lawmaker said, “he is really holding the economy hostage. The extreme focus on cuts to government spending reveals a lack of seriousness about America’s fiscal stability. Congress cannot cut its way out of the nation’s fiscal woes, just as it cannot tax its way out of them.”
Golden, who represents one of the most Republican-leaning districts held by any Democrat in the House, said the back-and-forth between the two sides has been “a waste of precious time. The country cannot afford to default on the debt, and eventually, Congress needs to pass a budget.”
“The country would be better served if Congress skipped the standoff, cut to the chase, and negotiated in good faith,” Golden said. “Quite frankly, it’s well past time for all of us — both the Legislative branch and the Executive — to stop the petty politics and do the job required of us.”
Golden offered his take on what a good compromise would entail.
He said Republicans have called for scaling back the budget to the 2022 level of $1.52 trillion, a reduction of $129 billion in one year.
Biden, on the other hand, has released a budget proposal that would, if adopted, spend $1.73 trillion, an increase of $76 billion.
Golden said a fair compromise would use the 2022 level but adjust it for inflation, basically holding spending flat in real terms at $1.63 trillion for the 2024 fiscal year budget. He said that level should be frozen for the 2025 budget as well.
As long as the top-line spending numbers are kept, he said, the debt ceiling should be raised automatically to keep pace.
Golden also addressed ways to cope with the soaring debt that he did not explicitly connect to his plan for coping with the looming debt ceiling crisis.
To reduce spending and help the deficit, Golden suggested ideas such as canceling Biden’s student debt proposal, rescinding $50 billion in unspent COVID-19 aid, raising the corporate tax rate by nearly 20%s for businesses with more than $10 million in profits and increasing the marginal tax rate on individual taxpayers who make more than $400,000 annually.
“Most politicians would not talk about a proposal like this” that could save $500 billion, Golden said.
“They fear the wrath of a thousand interest groups and accusations of being a socialist or a hateful conservative who wants to harm children and seniors,” he said. “I don’t blame them. The national political dialogue has become divisive and dishonest, with hundreds of billions spent each election to spread lies and misinformation.”
But, Golden said, “with the costs of inaction worsening each year, we need an honest debate about the nation’s financial future. We cannot afford to kick the can down the road forever.”
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