It is hard to know whether to be comforted, amused or alarmed by the latest attempt by House Republicans to set the nation on a course toward defaulting on its debt. Tuesday's vote by the House killing a proposed increase in the debt ceiling — a proposal Republicans put on the table just to kill it, like some sacrificial totem — was bizarre enough to justify all three reactions.
Democrats labeled it a political stunt, and it would be difficult to argue the point. It was not unlike the firing of a warning shot during a hostage taking. Only in this case, the armed perpetrator is threatening to fire the next round not into the air but into his own head.
At the heart of Republicans' grandstanding over the debt ceiling is self-destruction, after all. They are determined to risk making the U.S. economy — perhaps even the world economy — much worse by making it impossible for the country to pay its bills.
One can argue that the U.S. must get serious about deficit reduction soon or risk consequences that could prove just as dire as default. Not immediately, of course, but the country can't sustain its deficit-spending ways forever and expect economic growth and job creation. On that, President Barack Obama and members of both parties would appear to agree.
But what House Republicans are doing this spring amounts to the sort of behavior one associates with terrorists, criminals and lunatics — accede to our demands or we'll take actions that will hurt ourselves and everyone around us.
Perhaps it's all a bluff. Maybe they are posturing. Last week's vote rang so hollow that scores of Democrats joined in the game and voted the bill down, too. Many on Wall Street quickly dismissed it all as bad theater and turned their attention to slowdowns and a slump in hiring, genuinely bad news that sent markets reeling.
However, as a more authentic deadline nears — Aug. 2 is the day that Treasury Secretary Timothy F. Geithner says the government will run out of money — the stakes will be considerably higher. Moody's Investor Service warning, issued last Thursday, that it may downgrade bonds if the debt limit is not raised in "coming weeks" should inject a note of reality into this farce.
The White House line continues to be that a compromise will be found. President Obama met with both sides by week's end, and separate debt-reduction talks led by Vice President Joe Biden are ongoing. Hundreds of billions of dollars in possible budget cuts, perhaps as much as $1 trillion, are reportedly on the table.
But the president and congressional Democrats can't simply capitulate to hostage-taking. If they do, then House Republicans will become emboldened to do it all over again — strap on the proverbial dynamite suit and light a match. It will thrill their tea party supporters and, they might assume, boost their political prospects in 2012.
What Republicans seem to have forgotten is that the last time they engaged in such a high-stakes gambit, the 1995 government shutdown, the resulting voter outrage helped President Bill Clinton win reelection. And that was only over the inconvenience of furloughs and shuttered national parks. What would happen if the U.S. economy tanked and unemployment soared because of such irresponsible behavior by the House?
The only proper response is for Democrats to match Republicans hostage for hostage. If the GOP demands $1 trillion in deficit reduction, then Democrats ought to demand at least one-third comes from rollbacks of the Bush tax cuts. That would make the proposal similar to what was accomplished during the Clinton years.
Granted, risking government default is irresponsible no matter who does it, but the proper response to unreasonable behavior is never to give in to it. Either House Republicans agree to a comprehensive deficit-reduction plan that involves shared sacrifice (meaning higher taxes on the rich and not just cuts to programs that help the poor and middle class) or go ahead and pull the trigger.
Democratic voters will cheer to see Democrats behave like Democrats, and it's ultimately a political win-win for the party: Either the compromise plan to reduce the deficit is accepted (a victory for President Obama) or House Republicans refuse to budge and the nation defaults with all the calamity that entails (a huge loss for the GOP, though, unfortunately, also for the country).
Alternately, everyone could come to their senses and realize the debt ceiling is the wrong vehicle for achieving meaningful action on reducing the debt and back off the threats. But that looks unlikely in early June, with weeks to go before the shots fired look a lot less like warnings and lot more like a suicide attempt.