There have been few signs of progress in negotiations between President Joe Biden and the House GOP over raising the debt ceiling this week, as the “X-date” at which the government will be unable to pay its bills, and the accompanying prospect of economic turmoil, draws nearer.
And Republicans’ public comments suggest they’re digging in. House Speaker Kevin McCarthy has been insisting this week that the only “concession” House Republicans will offer to Democrats is raising the debt ceiling — hardly a concession. Rep. Patrick McHenry (R-NC), a GOP negotiator, said he’s “not yet an optimist on us getting this resolved.”
And on Wednesday afternoon, House leaders said members could leave Washington for Memorial Day weekend, suggesting a deal isn’t imminent. (McCarthy has also said that he’ll abide by a House rule saying the chamber must wait 72 hours after a bill is introduced before voting on it.)
If you take this at face value, it sounds terrifying. But should you?
The markets evidently think you shouldn’t. Stock traders’ apparent view is that this is all just posturing, and that a deal will be struck.
Because that’s how it always goes with debt ceiling brinkmanship. “Debt Ceiling Drama is Political Theater, Not an Existential Crisis,” a headline in the financial website TheStreet reads. In Washington, too, it’s hard to find many who will outright predict a default is the likely outcome.
That’s because, in a high-stakes, adversarial negotiation with an impending deadline, it’s common for both sides to dig in until the last minute, trying to drive as hard a bargain as possible. (Take Fox’s settlement with Dominion, reached just as a trial in the defamation lawsuit the voting machine company brought against the network was about to begin.)
Capitol Hill watchers frequently see this dynamic play out in Congress, where negotiators often loudly insist there’s no deal until, at the end of a prolonged process, one suddenly…
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