As Dan points out, it remains to be seen whether House Democrats are seriously considering such a strategy or if Rep. Barney Frank (D., Mass.) is simply blowing steam. At first glance, it’s hard to imagine that Democrats would be willing to take such an aggressive stand against President Obama.
As I mentioned in an article last week, the administration has taken a pretty hard line against Republican suggestions that raising the debt ceiling is by no means a guarantee. Austan Goolsbee, Obama’s top economic adviser, said on ABC’s This Week: “I don’t see why anybody’s talking about playing chicken with the debt ceiling. . . . If we get to the point where you’ve damaged the full faith and credit of the United States, that would be the first default in history caused purely by insanity.”
Never in our history has Congress failed to increase the debt limit when necessary. Failure to raise the limit would precipitate a default by the United States. Default would effectively impose a significant and long-lasting tax on all Americans and all American businesses and could lead to the loss of millions of American jobs. Even a very short-term or limited default would have catastrophic economic consequences that would last for decades. Failure to increase the limit would be deeply irresponsible. For these reasons, I am requesting that Congress act to increase the limit early this year, well before the threat of default becomes imminent.
Still, it’s understandable that Democrats would see an opportunity here, given the way that — to the ire of many Tea Party groups — Republican opposition to raising the debt ceiling has really evaporated over the past week or so, even among firebrand freshman members like Rep. Allen West (R., Fla.). Sens. Pat Toomey (R., Pa.), Mike Lee (R., Utah), and Rand Paul (R., Ky.) have all joined the “raise the ceiling, but extract concessions” camp, as have prominent fiscal hawks like Mike Pence (R., Ind.) and Jeff Flake (R., Ariz.), both of whom voted against the lame-duck tax compromise. Meanwhile, Reps. Michele Bachmann (R., Minn.) and Ron Paul (R., Texas) have become quite lonely in their efforts to avoid raising the debt ceiling under any circumstances.