extraordinary measures<\/a> to keep the government open.\n <\/p>\n\n Since the government spends more than it makes in revenue, it must borrow money to service its debt and pay for spending that Congress has already authorized. It has no problem getting more credit since the US always pays its bills and has always had a stellar credit rating, despite one previous downgrade from the threat of default.\n <\/p>\n
\n But it\u2019s no way to run an economy. Or a country.\n <\/p>\n
\n \u201cThis is about economic stability versus economic chaos,\u201d Brian Deese, the director of the White House\u2019s National Economic Council, said Thursday on \u201cCNN This Morning.\u201d\n <\/p>\n
\n \u201cWe have to not get in our own way. We have to not put this all at risk and jeopardize this by putting the full faith and credit of the United States at risk,\u201d he said.\n <\/p>\n
\n This year\u2019s debt ceiling showdown could be the riskiest yet, since Kevin McCarthy offered radical conservatives whose votes he needed to become House speaker guarantees that the debt ceiling would not be raised without significant cuts to government spending.\n <\/p>\n
\n Things could go off the rails because, essentially, Republicans are seeking to use the need to pay for past spending to force cuts in future spending. Raising the debt ceiling has been fraught in recent years when there\u2019s a Democrat in the White House and Republicans control either chamber of Congress. Adding a strong whiff of hypocrisy to the standoff, the GOP has typically had no problem doing so under big-spending Republican presidents and suddenly develops a compulsion to ensure fiscal discipline when there\u2019s a Democrat in the Oval Office.\n <\/p>\n
\n And now it\u2019s far from clear that McCarthy can deliver. Given his willingness to do anything to placate hardliners to win his job, alarm bells are ringing from Wall Street to Washington about what might happen.\n <\/p>\n
\n It may be impossible for the California Republican to both raise the debt ceiling and keep his job \u2013 and the country is heading to a fiscal cliff edge as a result.\n <\/p>\n
\n The opening exchanges in what is expected to be an acrimonious confrontation over debt broke out on Wednesday when hardline Arizona conservative Rep. Andy Biggs suggested he was willing to tank the economy to keep a promise to voters.\n <\/p>\n
\n \u201cWe cannot raise the debt ceiling,\u201d Biggs wrote on Twitter. \u201cDemocrats have carelessly spent our taxpayer money and devalued our currency. They\u2019ve made their bed, so they must lie in it.\u201d\n <\/p>\n
\n The comment ignores the fact that a large chunk of the debt the government now needs to pay for was accrued during the Trump administration. It also offered the White House an opening to launch what will be a monthslong campaign to level blame for a coming fiscal standoff on the GOP and to raise the pressure on McCarthy.\n <\/p>\n
\n \u201cRep. Biggs is dead wrong to actively support the ruin of millions of American livelihoods, 401k plans, and small businesses, all in the name of scorched earth partisanship,\u201d White House spokesperson Andrew Bates said.\n <\/p>\n
\n \u201cDefault would needlessly plunge the country into economic chaos, collapse, and catastrophe while giving our competitors like China an historic boost against us,\u201d Bates continued. \u201cThat\u2019s why congressional Republicans \u2013 with strong bipartisan support from Democrats \u2013 avoided default 3 times under Donald Trump, without conditions or playing chicken with our credit rating. This president and the American people will not stand for unprecedented economic vandalism.\u201d\n <\/p>\n
\n The gulf between the two statements encapsulates the high stakes gamble each side is taking. Most Republicans know they\u2019d probably get the blame for an economic meltdown caused by failing to raise the debt ceiling but are betting that because the consequences would be so severe, the White House will fold. The administration \u2013 in staking out its position that it will make no concessions \u2013 is implicitly wagering that the fury and political damage that the GOP would sustain by failing to act is so bad ahead of the 2024 election that McCarthy will blink.\n <\/p>\n
\n There\u2019s an analogy to nuclear deterrence \u2013 the consequences of using the ultimate weapon are so horrendous and self-defeating that neither side believes the other would risk it. Or would they?\n <\/p>\n
\n What makes the current standoff so perilous is that it can\u2019t be assumed that every Republican wants to avoid fiscal Armageddon. The extreme Trump wing of the party, which holds considerable power in the House given the narrow GOP majority, includes members who seem quite prepared to blow up the country\u2019s economic and political system and see where the pieces fall.\n <\/p>\n
\n Of course, McCarthy could make this a lot easier and piece together a coalition that includes moderate Republicans who have no wish to crash the economy and Democrats. But since he handed hardliners the capacity to write his political obituary \u2013 allowing a return to a rule that lets a single lawmaker call for a vote to oust him \u2013 he\u2019s unlikely to survive the consequences of constructing an end run around his party\u2019s extremists.\n <\/p>\n
\n The speaker seemed to be trying to take down the temperature of the showdown this week, even as the more extreme members cranked it up, although he also issued a warning that the White House must negotiate spending cuts.\n <\/p>\n
\n \u201cIf you had your child and you gave him a credit card, and they kept raising it, and they hit the limit so you\u2019ve just raised it again, clean increase, and again and again. Would you just keep doing that? Or would you change the behavior?\u201d he said. \u201cWe\u2019re six months away? Why wouldn\u2019t we sit down and change this behavior so that we would put ourselves on a more fiscally strong position?\u201d\n <\/p>\n
\n That might sound reasonable. But Congress almost never does anything six months before a deadline. And CNN\u2019s Kaitlan Collins reported Thursday that the president and the speaker have yet to speak on the issue.\n <\/p>\n
\n Still, it might seem appropriate to many Americans that the Republicans \u2013 who won the House majority, just barely, in the November midterms partially on a platform of cutting spending \u2013 should use the leverage they have to deliver for their voters.\n <\/p>\n
\n \u201cThe fastest way to guarantee that we have debt rating problems is to keep spending money we don\u2019t have and keep piling up debt and that\u2019s what we\u2019re doing,\u201d Texas Rep. Chip Roy, who extracted major concessions from McCarthy in the speakership race, told CNN\u2019s Jake Tapper earlier this month.\n <\/p>\n
\n The consequences of using a debt ceiling fight to make this point are huge, however, given the pain that would follow a debt default. And Republicans could instead wage this battle in the normal budgetary process, which might risk a government shutdown but may not tank the economy so quickly.\n <\/p>\n
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