Other spending would have to be put off or reduced, based on the amount of revenue available at any given time, until the debt limit had been raised. Since debt service now amounts to roughly 8 percent of the budget while the deficit is well over 30 percent, this would mean very significant limits on spending until the debt limit had been increased — whether by a large, across-the-board reduction of remaining spending or a partial shutdown of the relevant government programs and services. Both parties would have a strong incentive to come to agreements that prevented the debt limit from being hit, at least for long.
This proposal would improve, rather than undermine, America’s creditworthiness, as it would both avert any possibility of default and compel a discussion about getting our government finances into order. It would enable Congress to exercise its exclusive Article I authority to borrow while meeting its 14th Amendment obligation to assure “the validity of the public debt of the United States, authorized by law.”
Such a move would turn the debt-ceiling debate explicitly into what Republicans already treat it as being: an argument about ongoing government spending and deficits, like the debates about the budget or continuing resolutions, rather than about paying debts incurred for past spending and deficits. Democrats do not want that debate, but would not have an easy time rejecting this proposal. To do so would be to insist that default remain on the table, or else to insist that the president be given an unlimited power to borrow and spend. Surely neither is what the public wants or what the country needs.
What the public wants, and what the country needs, is for the federal government to pay its past debts but reduce its future ones. The debt ceiling should offer an opportunity for a debate about precisely how to do so. By carefully redefining the debt limit in law, Republicans can make sure that discussion takes place. And by then proceeding to offer specific spending cuts coupled with a proportional increase in the debt ceiling, they can help make sure that it ends with our country less in debt and better positioned to prosper.