Noah Harrison: Shutdown ends, but trouble looms

Tuesday, January 30, 2018 - 6:06pm

The federal government shutdown ended anticlimactically last week after three tense days, with a bloc of Senate Democrats lending their support to a Republican short-term spending plan. In exchange, Republican Congressional leaders promised to schedule a vote in the coming weeks on continuing the Deferred Action for Childhood Arrivals program, which President Donald Trump plans to dismantle.

Despite the compromise, a renewed struggle looms in the near future. The stopgap funding measure will expire on Feb. 8, setting the stage for a prolonged battle over a long-term spending plan. Even with the Republican concessions, many Senate Democrats and a majority of House Democrats still voted against the spending bill that ended the shutdown, raising the possibility that the government could shut down again, especially if Congress is unable to come to an agreement on the future of DACA. An even more bitter fight potentially waits in the distance over the debt ceiling, which will need to be raised or suspended at some point this year.

This shutdown — and the sparring to take place over the next few weeks — is closely intertwined with immigration policy, similar to the infamous 2013 shutdown revolving around Obamacare. While policy takes the central role in each iteration, the broader issue of the national debt looms above these spending battles, even though shutdowns are not directly related to the debt.

The current hyper-partisan political climate prevents Congress from reliably passing the 12 core appropriations bills, as in decades past. This forces Congress to fund the federal government with massive “omnibus budgets,” but the deep divide between Republicans and Democrats on government spending, taxation and the federal deficit makes this challenging. When legislators fail to agree to an omnibus budget, Congress must resort to funding the federal government through a series of short-term continuing resolutions. These continuing resolutions are ripe for partisan conflict, as evidenced by the current fight over DACA. Since their primary purpose is to simply keep the government operating, continuing resolutions often fail to address budgetary concerns or produce a plan to stabilize the national debt.

Though Republicans championed themselves as deficit hawks throughout the Obama administration, their actions thus far during the Trump presidency paint a different picture. The GOP’s signature piece of legislation in 2017, the tax reform bill, slashes government revenue, which inevitably bloats the federal deficit, thus increasing the national debt. When passing the bill, Republican leaders argued that economic growth would offset the tax breaks, leaving government revenue levels the same, but this contention is simply not supported by the facts. The nonpartisan Congressional Budget Office projects the tax bill will pour $1.5 trillion onto the national debt, while an analysis by The Wharton School of Business at the University of Pennsylvania predicts a nearly $2 trillion national debt increase.

Meanwhile, Trump seems misinformed about the national debt, despite his campaign pledge to eliminate it within eight years. On the campaign trail, Trump made a disturbing proposal to renegotiate the debt in hopes of persuading the U.S. government’s creditors to accept less than they are owed — in essence, defaulting on the national debt. Doing so would derail the U.S. economy and irreversibly destroy investor confidence in the federal government, as experts were quick to point out.

And after Trump was blasted for the proposal, he countered with the claim that the U.S. can’t default on the debt, since it can merely print money. This is technically true — the U.S. Treasury could theoretically just make the money it owes — but this “solution” is nonetheless ludicrous, as it would lead to catastrophic inflation and major economic problems of its own.

Since his victory and inauguration, Trump has stepped back from his renegotiation proposal while making several more suspect claims. Last October, Trump blamed the debt on foreign aid, even though such aid constitutes only a minute fraction of the federal budget. Days later, Trump falsely claimed that gains in the stock market are reducing the debt.

Little can be interpreted from the president’s statements about his true feelings towards the national debt, but his conflicting claims and evolving positions are clear evidence that his administration lacks a clear and realistic plan to address the national debt. In fact, Trump’s enthusiastic embrace of the Republican tax plan indicates that the debt is likely to grow far worse during his presidency.

In order to truly address the national debt, a pragmatic solution involving both reasonable tax increases and spending cuts is needed. Unfortunately, such a solution seems unlikely to manifest itself in the near future given the passage of the Republicans’ fiscally irresponsible tax bill and the Trump’s apparent commitment to wasteful spending on frivolous matters such as his infamous border wall. Still, voters and legislators should not let the national debt fade into the political background. Without concrete action and responsible budgeting, Congress could easily come to rely on continuing resolutions to fund the government. If these stopgap measures become the norm, shutdowns will become commonplace and our government’s functions will consistently be held hostage to partisan gimmicks and political feuds.

Though the end of the latest shutdown may bring short-term relief, it is no cause for celebration and Congressional leaders deserve little praise for the bare bones stopgap measure that temporarily reopened the government. With this spending plan only funding the government until Feb. 8, more trouble looms on the horizon, and always will unless political leaders can reach consensus on budgeting and implement a comprehensive plan to counter the nation’s growing debt.

Noah Harrison can be reached at noahharr@umich.edu