Remembering our fallen soldiers.

Memorial Day, 2023

          Monday is Memorial Day in the U.S., which honors military personnel who died while serving in the U.S Armed Forces. I have attached a photograph of Aisne-Marne American Cemetery in Belleau, France. My wife and I visited the Aisne-Marne cemetery in 2018, which is the resting place for the thousands of American troops who gave their lives defending our first and oldest ally—France. The elegiac beauty of the American Cemetery at Aisne-Marne is a fitting monument to the bravery and sacrifice of our fallen soldiers.

          The Aisne-Marne cemetery is built over the front-line trenches of the Battle of Belleau Wood, one the bloodiest and most decisive battles of World War I. The cemetery contains the graves of 2,289 Americans, which are marked by white crosses and Stars of David.

          As shown in the photo, the white crosses and Stars of David face the small patch of trees known as Belleau Wood—the center point of the battle. The grave markers face in the same direction as the US soldiers when they huddled in shallow trenches that provided meager protection from machine gun fire coming from Belleau Wood.

          Aisne-Marne is one of two-dozen cemeteries on foreign soil containing the graves of Americans who died defending our freedom and never returned home. Over a million Americans sacrificed their lives for our nation while serving in the US military. We are in their debt and should never forget what they have done for us.

A contingent agreement on the debt ceiling.

          President Biden and Kevin McCarthy reached a deal “in principle” on Saturday to raise the debt ceiling for two years. Democratic and Republican leaders must now convince their caucuses in Congress to support the proposal—a result that should not be taken for granted. There is much to discuss about the deal, which may change by amendment as it makes its way through Congress.

          The details of the deal matter, and I will address them in the days to come. Today, I want to step back to gain perspective on what just happened—which is a positive development for all Americans and a masterstroke by President Biden. Before I start that discussion, we should acknowledge that many Americans are angry about the outcome, the process, and the precedent that the deal will establish. Those feelings are reasonable and have a solid basis in fact. We should not dismiss or minimize those concerns, and I promise that I will not do so. Please be patient as we explore this developing deal over the next few days.

          But given the potential calamity we faced we must acknowledge that the deal is a huge win for all Americans. And it is a testament to President Biden’s experience and skill in managing Congress—a body in which he spent most of his career.

          Here’s the takeaway: We have avoided a default and simultaneously agreed to a budget deal that will last two years that freezes some spending at 2021 levels. It is nearly impossible to overstate the significance of that achievement.

          Given the divided nature of Congress, two years of financial stability is an unexpected windfall.

          Better yet, the politics of another potential default will be delayed until after the 2024 election—an outcome that will spare us from the spectacle of candidate Trump using another debt default as leverage in his campaign. (Steve Bannon complained bitterly that the deal “kick[ed] the ball past 24 election” and will “strip Trump and the people of their leverage.”)

          The most cogent analysis (as usual) comes from Josh Marshall at Talking Points Memo. Marshall observes that “something like this set of concessions was more or less baked in the moment Republicans won control of the House.” Or, as Bill Kristol explained on Twitter, the “domestic spending freezes no worse than the [continuing resolutions] that a GOP House would have produced.”

          The import of the observations by Marshall and Kristol is this: After Republicans gained control of the House, they were never going to approve a Biden budget and were always going to propose ludicrous budgets that would never pass in the Senate, resulting in the necessity of passing “continuing resolutions” to maintain spending levels set in 2021. That is the deal that Biden effectively negotiated with McCarthy—meaning Biden gave up essentially nothing on the spending front. And Biden protected Social Security, Medicare, Medicaid, and most of the climate protection programs and investments included in the Inflation Reduction Act.

         Republicans are beginning to realize that Biden gave away very little. Indeed, members of the Republican Party are saying out loud that McCarthy achieved nothing in the negotiations. JD Vance wrote, “It’s not entirely clear we got anything.” And Freedom Caucus members in the House are seething with anger. In an early call to sell the deal to House Republicans, Rep. Dan Bishop (R-N.C.) reportedly said that House Republicans on the call were “congratulating McCarthy for getting almost zippo.” Ouch!

          Biden did make concessions, although all descriptions of those concessions must be viewed skeptically. McCarthy is crowing about cuts to funding for the IRS. True, Republicans did reduce proposed funding for the IRS by $1.4 billion dollars—"leaving the IRS budget $78.6 billion higher than when Biden took office.” See NYMagazine, The No Good, Not That Bad Debt Ceiling Deal.

          For a detailed discussion of the concessions Biden did make, see the NYMagazine article above. Changes to work requirements for SNAP are receiving significant attention in the media (as they should). But the impact of the change is unclear. The existing work requirements for those aged 18 to 49 will be raised to 54. But veterans and homeless people are exempted from the work requirement—an “unexpected, last-minute” change. An earlier Congressional Budget Office estimate said that 275,000 people could lose SNAP benefits because of the expanded work requirement but also noted that many of those who would lose benefits are homeless. The last-minute exemption for homeless people and veterans might significantly reduce the number of those affected by the rule change. See HuffPo, Joe Biden Agrees To Stricter Work Requirements To Avoid Default.

          Of course, many readers are unhappy that Biden negotiated over the debt ceiling at all. Instead, they wanted him to use the 14^th Amendment to issue new debt without approval from Congress. (I generally agree with those views.) But it is probably better to dis-entangle a fight over the constitutionality of the debt ceiling from an ongoing debt default—when the markets would be roiled even if Biden issued bonds without congressional authorization. The better path is to repeal the debt ceiling legislation when Democrats gain control of both houses of Congress in 2024.

          It will take weeks to understand the full scope and impact of the deal Biden negotiated. But the initial take is that Biden negotiated a better-than-expected deal. Let’s wait for the Wednesday vote in the House to see whether McCarthy can deliver.

Concluding Thoughts.

          Although getting the debt ceiling deal through Congress will be difficult, there are more pathways to success than to failure. Some Republicans are planning to make last-minute stands in the House and Senate so they can claim they resisted increasing the national debt. It seems unlikely that the House GOP will fail to scrounge enough votes to help Democrats pass the bill. And Mitch McConnell has already said he supports the deal. It may be a bumpy ride, but Biden will likely sign the bill on Thursday or Friday of this week.

          There will be plenty of time to second-guess and criticize the bill after it is passed. For now, we should again acknowledge how fortunate we are to have Joe Biden as our president during this challenging moment in our nation’s history.

Talk to you tomorrow!