Most of us on the progressive side have relied on a strategy for dealing with this Teahadist putsch, this use of the debt ceiling as a veto point, that involves painting that as horribly irresponsible, playing with fire, because the consequences of failing to raise the ceiling would be horrific, an apocalyptic default. If anyone in the debate has questioned that idea that default would follow a failure to raise the ceiling, it has tended to be Teahad apologists and excuse-makers.
Well, our sides's strategy has failed. They did their blackmail thing, and it's worked. They got the D leadership to agree to sell the farm by threatening to blow up the farm.
Unfortunately, our strategy was based on a lie. If the national debt were to reach and exceed the ceiling, the only thing Treasury could do, could practically and legally do, would be to continue treating the effective ceiling as however much Treasury has to borrow to continue meeting all the legal obligations of the US. That stance would never be seriously challenged in the courts, because it would do damage to no one, and if it were challenged, it would be vindicated. For Treasury to do the opposite, and ignore the legal requirements on it to pay all US obligations, would, on the other hand, create all sorts of damage to all sorts of parties who would be able to sue. And these parties would stand an excellent chance of winning their cases against the US, and perhaps even against involved govt officials, who might conceivably be held to have come out from under their official immunity by wilfully breaking the laws that obligated the spending they refused to transact.
Great, so progressives can now defeat this monstrosity of a grand bargain by just teaming up with the Teahad fringe that's voting against any rise in the ceiling no matter what, right? Busting through the ceiling will have no effect, so it's safe to do so, while approving the grand bargain would result in disaster, so this is a no-brainer, right?
Well, except that our side has just spent months denouncing the other side for being so irresponsible as to hold default hostage. That trick failed, but in trying a manipulative ploy that was never going to work, by lying in a good cause about the supposed horrific effects of not approving a rise in the ceiling, we would now find it very difficult to defend the course of action that was always there, sure to work, certain to prevent any disastrous give-away grand bargains.
Our side should have taken the stance from the very outset that the ceiling was not at all a real veto point, that Treausry could not and would not observe any ceiling but the real legal ceiling bearing on it, which is however much money needs to be borrowed to meet all the obligations Congress has assumed by passing laws that obligate spending. We should have made it clear that we would never be voting for any bargain reached with folks who were hostage-takers for trying to get concessions by threatening default, and also idiots for imagining that denying a rise in the ceiling would cause default.
But we've played along with their delusion. It's now a delusion with a bipartisan stamp of approval, an official folie a deux. So progressives will not vote in any numbers against any grand bargain, however heinous, because we have said so long that no rise in the ceiling means default, and default is more heinous than anything imaginable.
We let this become a diving contest, in which the party that was more willing to be more passive-aggressive would win. Of course the other side won. Passive-aggressive is their signature dish. Having won with it, they will continue to use it, over and over again, in ever-escalating fashion.
That's the feature of this grand bargain they're describing that bears most attention, that it does not represent any sort of final resolution, but instead has as its main feature that it creates a process of frequent future fake veto points with which the other side will do the same damn thing that worked for them this time. Only next time, with this grand bargain passed into law, there actually will be some legal basis for the ceiling and their newly created veto points being real, and not just fake, veto points.
Despite the difficulty, despite the admission that it would involve that our side was BSing, our side's best course of action is still to vote against any rise in the ceiling except a completely clean rise. Yes, it will be more difficult to take a stand now, to explain now why that stand is correct after BSing so long to the contrary. But putting off the admission and course reversal will only make it progressively more difficult to eventually do the right thing. This problem is not going to be ended by this grand bargain. The grand bargain is just the beginning, and once it is made law, it will be much harder to stop this process that we now find hard to oppose despite the utter toothlessness of the threat. There is going to have to be a course reversal and admission of past BS at some point, and the later that point is, the more difficult it will be.