Plus, a major Tangle announcement!
I’m Isaac Saul, and this is Tangle: an independent, nonpartisan, subscriber-supported politics newsletter that summarizes the best arguments from across the political spectrum on the news of the day — then “my take.”
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It's finally here: Tangle Live.
Dear readers,
It has been a long time coming, but today I am thrilled to announce we have a date for our first ever Tangle live event:
August 3rd, 2023, in Philadelphia, Pennsylvania. The event will be held at Brooklyn Bowl Philadelphia.
This event will bring the experience of the Tangle newsletter live to the stage, where we'll explore one topic through a moderated discussion with guests from opposing sides of an issue. I'll be hosting and moderating, with opportunities for a meet and greet before the show and an audience Q&A afterward.
Password-protected pre-sale tickets will be available for paid subscribers starting tomorrow at 12 pm EST. We'll be sending paid subscribers the password in our Friday edition. On Monday, tickets will go on sale to the general public.
If you want to get a password for pre-sale tickets tomorrow, it's not too late to become a Tangle member.
Thank you so much for all the support that got us here. And please come to the show. We want to sell this baby out!
Today's read.
Quick hits.
- Montana Gov. Greg Gianforte signed a bill into law banning TikTok from being downloaded or operated in the state, the first state to implement such a ban. (The ban)
- The Supreme Court rejected applications for emergency relief from a gun rights group and gun store owner trying to block an Illinois law banning semi-automatic rifles. (The rejection)
- House Republicans blocked an effort to expel Rep. George Santos from Congress (R-NY). (The vote)
- An Islamic extremist convicted of killing eight people in Manhattan by driving his truck through a bike path in 2017 received a life in sentence plus 260 years in prison on Wednesday. (The sentence)
- Turkish President Recep Tayyip Erdogan said Russia had agreed to a two-month extension of the U.N.-brokered Black Sea grain deal needed to stabilize global food prices. (The deal)
Today's topic.
The debt ceiling. Negotiations over the debt ceiling appear to be coming to a head. President Joe Biden and House Speaker Kevin McCarthy reiterated on Wednesday that they are determined to reach a deal to raise the $31.4 trillion debt ceiling and avoid a potential default, with McCarthy indicating a deal could be struck as soon as this weekend. Treasury Secretary Janet Yellen has reiterated that a deal must be struck by June 1 or the federal government will be unable to pay its bills.
Reminder: The U.S. government regularly spends more money than it collects in revenue. To cover this yearly shortfall, called the deficit, the government borrows money by issuing government securities, or bonds. Investors lend that cash with the expectations the government will pay them back with interest. Those loans make up our national debt.
The debt ceiling, established in 1917 during World War I, is the legal limit on how much debt the federal government can incur. To avoid defaulting on our loans, which would downgrade our credit and set off an economic crisis, the debt ceiling has been raised nearly 100 times since its inception.
You can watch our debt ceiling explainer video or read our debt ceiling explainer piece.
On Tuesday, Biden and McCarthy met at the White House with Senate Republican leader Mitch McConnell, House Democratic leader Hakeem Jeffries, and Senate Majority leader Chuck Schumer. Republicans are insisting Democrats agree to spending cuts in exchange for a deal to raise the debt ceiling again, and have passed their own legislation to do so. McCarthy has also said he won't accept a deal without increased work requirements for certain social safety net programs. Also central to the negotiations are how long to raise the debt ceiling and what federal spending to cap.
Meanwhile, Biden has said he won't support work requirements for Medicaid health insurance, which serves low-income Americans, while McCarthy has said he won't support raising taxes on the wealthy or businesses, which is a key part of Biden's 2024 budget strategy to raise revenue. Biden has left the door open for some work requirements, potentially for programs like food stamps.
Meanwhile, a few Senate Democrats are calling on Biden to invoke the 14th Amendment to declare the debt ceiling unconstitutional and push forward without Republicans. This path is legally perilous (explained here) but appears to be growing in popularity among Senate Democrats worrying that a deal may not be struck in time. Section 4 of the 14th amendment says, “The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned.”
Some Democrats believe this is a guarantee the U.S. will always make good on its debt and actually frames the 1917 debt ceiling law as unconstitutional. The Washington Post reported that six Democratic Senators — including progressives like Bernie Sanders (VT) and Tina Smith (MN) and moderates like Angus King (ME) — are suggesting Biden take this path, or at least prepare for it.
On Wednesday, Biden left for the G-7 summit of world leaders in Japan, though he has decided to cut his trip short and come back early in the event a deal isn't struck while he's abroad. Any deal would require the support of dozens of House Democrats and a "healthy number of Senate Democrats," according to Punchbowl News, which is why some Democrats fear a passable deal won't be landed.
Today, we're going to break down some arguments from the left and right about the debt ceiling negotiations, then my take. You can read our previous debt ceiling coverage here.
What the left is saying.
- Many on the left strongly oppose work requirements and criticize Republicans for trying to implement them.
- Some argue that Biden should simply ignore the debt ceiling and keep paying our debt, even if we breach it.
- Others say Biden should invoke the 14th amendment to take the power out of Republicans’ hands.
In The New York Times, David Firestone said Republicans are using the debt ceiling "to inflict cruelty on the poor."
The debt ceiling battle might seem like an abstract argument over federal spending, but for "millions of low-income Americans who depend on the federal government for health care and basic nutrition, the debate is about their very lives. That’s because Republicans have singled them out, yet again, as a prime target in this year’s extortion scheme." Republicans bill passed in Congress "would effectively cut off health care for 1.7 million low-income people and cut off food stamps for 275,000 people."
There is no crisis or scandal gripping these programs, "Republicans are making these demands simply because the debt ceiling gives them the opportunity to do so." And they are persistently ignoring that the vast majority of people receiving these benefits already work. "In 2021, 61 percent of the 25 million people on Medicaid were working in full- or part-time jobs. The rest were retired or disabled or taking care of small children or in school. Similarly, most food-stamp recipients work, and able-bodied adults younger than 50 are required to work in order to get more than three months of benefits in three years, unless they are taking care of children."
In The Los Angeles Times, Neil H. Buchanan and Michael C. Dorf said the best way to deal with the debt ceiling is to ignore it.
"The problem is that if Biden makes any concession as the price of raising the debt ceiling, it will encourage Republicans to take the global economy hostage again and again. After all, their proposal would provide only a short respite from extortion, setting the stage for another showdown less than a year from now," they wrote. Conventional wisdom is that if Congress fails to raise or suspend the debt limit, the president has to choose who to pay and who to stiff. But this conventional wisdom is wrong. "The Constitution assigns the power to spend money to Congress," they said.
"Biden could no more fail to pay the nation’s bills than he could refuse to serve as commander in chief of the armed forces... Once we hit the debt ceiling, Biden will bump into a constitutional obstacle no matter what he does. Failing to spend appropriated funds, raising taxes or borrowing money to pay the bills would all infringe on Congress’ constitutional powers." So, they wrote, he should pick the least unconstitutional option, which is to "instruct the Treasury Department to continue to issue bonds sufficient to cover the shortfall between taxes and appropriations — just as it always does."
In The New York Times, Laurence Tribe explained why he changed his mind on the debt limit, and now thinks using the 14th amendment is constitutional.
"The question isn’t whether the president can tear up the debt limit statute to ensure that the Treasury Department can continue paying bills submitted by veterans’ hospitals or military contractors or even pension funds that purchased government bonds," Tribe wrote. “The question isn’t whether the president can in effect become a one-person Supreme Court, striking down laws passed by Congress. The right question is whether Congress — after passing the spending bills that created these debts in the first place — can invoke an arbitrary dollar limit to force the president and his administration to do its bidding."
"There is only one right answer to that question, and it is no," Tribe said. "And there is only one person with the power to give Congress that answer: the president of the United States. As a practical matter, what that means is this: Mr. Biden must tell Congress in no uncertain terms — and as soon as possible, before it’s too late to avert a financial crisis — that the United States will pay all its bills as they come due, even if the Treasury Department must borrow more than Congress has said it can."
What the right is saying.
- Some on the right support work requirements, and argue that Republicans have a strong proposal to enact them.
- Others say these negotiations should focus on fraud and clawing back money given out during the pandemic.
- Some criticize the 14th amendment proposal as a gross abuse of executive power.
In Fox News, Newt Gingrich said the Republican Medicaid plan shows how to make work requirements work right.
"While the Congressional Budget Office estimates the Medicaid work requirements in the bill will save $109 billion over the next 10 years, the money savings are not why the reform is so important," Gingrich said. "In fact, work requirements for welfare programs are vital for the health and wellbeing of those receiving benefits." The House plan is built on the "highly successful" unemployment reforms Republicans passed in 1996. "Prior to the 1996 reforms, our nation’s welfare system had become a poverty trap. That’s because its focus was on making poverty less uncomfortable rather than lifting people out of poverty. The dignity of work was disregarded."
"Including work requirements in Medicaid would build on that success," he wrote. "There is ample evidence that Medicaid coverage without work requirements creates a disincentive to work. In 2005, Tennessee disenrolled 170,000 individuals — 91% of whom were childless adults. A 2013 analysis from NBER found 'an immediate increase in job search behavior and a steady rise in both employment and health insurance coverage.'" These requirements would also be better for the health of enrollees, not only because higher income correlates with better health outcomes, "but also because more time in the workforce leads to better jobs that provide health benefits" which are usually better than Medicaid.
In The Washington Examiner, David Walker said Biden and Congress must address PPP fraud.
"What has not yet been addressed" is "the need to stop the failed bipartisan 'extraordinary measure'' of utilizing high-risk, government-sponsored lending and grant programs to stimulate the economy, which, by emboldening bad actors and creating economic bubbles, has contributed to the current fiscal mess," Walker wrote. The government has flooded the market with cash "time and time again" but this "recession mitigation strategy has inflated America’s debt instead and increased cases of fraud while ballooning the frequency of these federal debt ceiling showdowns between the two political branches of government."
The Paycheck Protection Program (PPP) is a recent example of this problem. The government "took the program too far and failed to incorporate adequate internal controls to prevent fraud and abuse." Given that two recessions in 15 years involved "reckless government lending and grant programs," we need these negotiations to include increasing transparency and oversight over federal lending and grant activities and holding the fintechs and other bad actors accountable for their fraud. Lawmakers should also work toward clawing back the billions of dollars of taxpayer-funded fees that went to companies that enriched themselves during the pandemic by committing obvious fraud."
National Review's editors called Joe Biden's 14th amendment idea folly.
Biden is "musing aloud about violating his oath of office and seizing powers not granted him by the Constitution in order to avoid negotiating with the House of Representatives. This is a shameful way for the president of a constitutional republic to act," they said. "The so-called 14th Amendment option — to have the president issue debt not approved by Congress — doesn’t actually exist. Until 2023, nobody in the executive branch has ever pretended that it does."
"The Constitution is quite explicit: Congress, and only Congress, has the power 'to borrow Money on the credit of the United States.' Congress, and only Congress, has the power to raise revenue, and all bills to do so must start in the House," they wrote. "The Framers were quite open in designing this system to give Congress the power of the purse so that it could bring the executive to heel. Section Four of the 14th Amendment, designed to ensure the repayment of Civil War debts even over Southern objections, barred the federal government from repudiating its existing debts. But it did not, explicitly or implicitly, change the allocation of power to issue new debt."
My take.
Reminder: "My take" is a section where I give myself space to share my own personal opinion. If you have feedback, criticism, or compliments, don't unsubscribe. You can reply to this email and write in. You can also leave a comment.
- Biden should not invoke the 14th Amendment, change work requirements, or allow the debt ceiling to be breached.
- Both sides are negotiating, as they should, and that's how they should resolve this.
- If some spending caps or very modest work requirements need to be put in place for a deal, that's okay. But major policy or budget issues should not be resolved now.
Reading all these arguments I am left with the overarching feeling that this is just not how this should be done.
The 14th amendment stuff is a bridge too far for me. While Tribe (under "What the left is saying") raises some compelling points from a legal perspective, I can't get over the optics of it. The practical element of it. The historical element of it. Never once has any administration interpreted the 14th Amendment that way, and never once has anyone tried to exercise it in this way. Biden should not start now. In a presidency that has included so much executive action and consolidated power, I think it would create more instability, more political hostility, and possibly trigger a constitutional crisis. That is not the way out, negotiating is.
When it comes to negotiations, I also don't think this is how work requirements should be implemented in any budget or policy proposal around welfare programs. Work requirements are very complicated and if they are going to be implemented, it should probably happen at the state level. For instance, Arkansas experimented with them in 2018 and it went very badly, and the program was eventually struck down by a judge. A study found 13% of people lost their health coverage and no significant change in employment occurred. If you are going to implement these conditions, I think it needs to be done much more carefully. Not like this.
If Republicans want work requirements for Medicaid, there are a few ways to do it: 1) Convince a handful of Democrats in each chamber to come to their side and pass legislation implementing them, 2) Create enough political pressure on Democrats to implement them, 3) Win enough seats in Congress (or win the White House) so you don't need Democrats to implement them, or 4) Find a legal way to do it at the state level.
The way not to do it is to force them through in this manner, knowing it is a stark red line for half of Congress and with the stability of our economy hanging in the balance. So, similar to my feelings on the 14th Amendment, I'm just left thinking this is not how this should be done. As it happens, Americans appear to broadly favor work requirements, so Republicans' options on how to use the democratic process to pass them are wide open.
Implementing work requirements through a debt ceiling standoff to rein in spending is especially hard to swallow given how the last couple years have played out. Rep. Matt Gaetz (R-FL) argued for work requirements by saying “I don’t think hard-working Americans should be paying for all the social services for people who could make a broader contribution and instead are couch potatoes." As Firestone noted (under "What the left is saying"), Gaetz also requested a $141.5 million earmark for a helicopter training hanger in his district. If you're going to be fiscally responsible, then do it. Many Republicans were not so careful when they had control of Congress.
I'm glad Biden and McCarthy and congressional leaders are negotiating. I hope they soon come to a deal, and I'm fine if that deal includes a short-term debt ceiling lift, some spending caps, and maybe even some very modest work requirements applied to certain programs. But the most important thing is not defaulting, not making drastic budgetary or policy changes in a moment like this, and not taking a constitutionally untested path that would set off legal battles and more instability. I'm simply hoping both sides step off that ledge.
New video!
We're skipping our reader question today to let you know we've got a new video out on YouTube! This one is a broad look at the border crisis, with some analysis of the left and right's best arguments on how to solve it. Complete with graphics, data, videos, and my thoughts on the overarching issues we should resolve:
Under the radar.
Since the Supreme Court overturned Roe v. Wade, Republicans have underperformed in elections at nearly every level. And many pollsters are increasingly convinced the two are related. Jacksonville, Florida, elected just its second Democratic mayor in 30 years on Tuesday, despite the Republican nominee being endorsed by popular Gov. Ron DeSantis (R). In Colorado Springs, Colorado, independent Yemi Mobolade was elected as the first non-Republican mayor since 1979; local media called the win a "political earthquake." In Pennsylvania, Democrats held onto a one-seat House majority in a special election in Philadelphia's suburbs, which will allow them to block a GOP bill to limit abortion rights.
One caveat? In Philadelphia, a tough-on-crime Democratic candidate for mayor prevailed convincingly, a signal that Republicans’ stance on policing has resonance there. Still, Democrats have outperformed their 2020 results by an average of six points across 18 state legislative races this year. Axios has the story.
Numbers.
- 80%. The share of Republicans who say they support requiring Medicaid or SNAP benefit recipients to show proof of work to receive benefits.
- 66%. The share of independents who say they support requiring Medicaid or SNAP benefit recipients to show proof of work to receive benefits.
- 49%. The share of Democrats who say they support requiring Medicaid or SNAP benefit recipients to show proof of work to receive benefits.
- 22%. The share of Americans who favor cutting Medicare or Social Security to reduce the deficit.
- 37%. The percentage of Americans who think a failure to raise the debt ceiling followed by a default would be a crisis.
- 40%. The percentage of Americans who said a failure to raise the debt ceiling followed by a default would be a major problem, but not a crisis.
- 64%. The percentage of Americans who think Republicans should agree to raise the debt ceiling only in return for spending cuts.
Reminder.
Tickets for our first ever live event go on sale tomorrow. If you're a paying subscriber, keep an eye out for a password to unlock them tomorrow. If you aren't a paying subscriber and want Friday editions (and tomorrow's password!) subscribe here. Otherwise, keep an eye out for more information on Monday.
The extras.
- One year ago today, we were covering Sweden and Finland's bid for NATO.
- The most clicked link in yesterday's newsletter was the guy playing with a giant bear.
- Divided, like America: 43.1% of Tangle readers said the Trump-Russia investigation "was an attempt to hurt Trump politically, and should not have been conducted." 42.4% said "the investigation was sloppily done, but there were good reasons to start it." 6.7% said the "investigation was conducted reasonably and uncovered serious criminal acts."
- Nothing to do with politics: Scientists say they’ve found the closest living relative of the first animal.
- Take our poll. Who would you blame if we breach the debt ceiling and have a default? Let us know.
Have a nice day.
A Georgia resident is transforming rundown buildings into affordable housing — and there appears to be no building that can scare her off. Marjy Stagmeier has taken several rundown properties in Atlanta and turned them into safe places to live with fair rents. She is an "affordable housing innovator" and recently launched a nonprofit that offers after-school programs at the apartments while partnering with local schools, health clinics, and other organizations for residents. At one complex, Stagmeier was able to renovate units for $45,000 each (rather than rebuild them for $130,000), which allowed her to keep rent at $725 per month instead of $1,300 per month. Those kinds of results are garnering her national attention. The Week has the story.
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