The Government can survive until at least March and possibly May. This is the first time I have ever backed a government shutdown.
Trump Stuns Washington
The Washington Post reports Trump Stuns Washington with Push to Repeal Debt Ceiling
President-elect Donald Trump has stunned lawmakers in Washington by calling for the suspension — or outright elimination — of the federal borrowing limit, introducing an explosive new demand into last-minute negotiations over averting a government shutdown this weekend.
In social media posts and interviews on Wednesday and Thursday, Trump called on congressional Republicans to lift the debt ceiling, a law that limits how much money the federal government can borrow.
The cap is currently suspended until Jan. 1, 2025, under a bipartisan deal struck last year. The Treasury Department can use what it calls “extraordinary measures” to finance new expenditures without borrowing beyond the limit. That would probably cover the government until May or June, though nobody can say for sure.
On Truth Social on Wednesday, Trump said of the government spending deal: “Can anyone imagine passing it without either terminating, or extending, the Debt Ceiling guillotine coming up in June?”
Trump later told NBC News of the debt limit: “The Democrats have said they want to get rid of it. If they want to get rid of it, I would lead the charge.” He said getting rid of the debt ceiling entirely would be “the smartest thing” Congress could do.
“This was on no one’s radar,” said one senior congressional aide, speaking on the condition of anonymity to reflect private deliberations. The aide said he was unaware of the debt ceiling demand being part of discussions over government funding between Johnson and Democratic leadership.
Trump Threatens to Remove Johnson
Fox Digital reports Trump says Mike Johnson will ‘easily remain speaker’ if he acts ‘decisively and tough’ on spending bill
Fox News Digital spoke exclusively with the president-elect Thursday morning, just hours after the bipartisan deal to avoid a partial government shutdown was killed.
“Anybody that supports a bill that doesn’t take care of the Democrat quicksand known as the debt ceiling should be primaried and disposed of as quickly as possible,” Trump told Fox News Digital.
Vice President-elect JD Vance met with House Speaker Mike Johnson, R-La., Wednesday night. The two spoke about the potential continuing resolution for about an hour. Vance said the two had a “productive conversation,” and said he believes they will “be able to solve some problems here” and will continue “working on it.”
In addition to funding the government through March 14, the bill included more than $100 billion in disaster aid to help Americans affected by Hurricanes Milton and Helene. It also included $10 billion in economic relief for farmers, as well as health care reform measures and a provision aimed at revitalizing Washington, D.C.’s RFK stadium and its surrounding campus.
The bill also proposed a pay raise for members of Congress.
Members of the House Freedom Caucus said they felt blindsided by what they saw as unrelated policy riders being added to the bill in last-minute negotiations.
Several GOP lawmakers granted anonymity to speak freely said Johnson would see challenges to his speakership bid in early January over the matter.
Sources said top Republicans like House Majority Whip Tom Emmer, R-Minn. House Judiciary Committee Chairman Jim Jordan, R-Ohio, and Rep. Byron Donalds, R-Fla., were mentioned in early talks about alternatives.
Pay Raise for Congress
Johnson went along with a wasteful bill. Was it because, or was it despite, a pay raise?
Regardless, it stunk to high heavens for many reasons.
I commented House Speaker Johnson Approves Another Reckless Spending Bill
Senator Rick Scott blasts House Speaker Mike Johnson over a massive 1500+ page spending bill.
Conservative Play Call Nonsense
If I am not mistaken this would be the 4th Continuing Resolution from Republicans.
“We don’t normally like the CR, but in this case it make sense,” said Johnson.
What an F*wad. This was the only continuing resolution that made no sense. I back a government shutdown now because this is the only one where Republicans could realistically deliver.
Johnson Must Go
In 2023 and 2024, it was idiotic to expect anything other than humiliation when a few House members thought they could control legislation with Democrat control over the Senate and a Democrat in the White House as well.
Trump will take office at the presidential inauguration on Monday, 20 January 2025, so what’s the hurry?
For at least a few months, the Treasury can make sure all key government expenses are paid.
Dear Congress, Please Shut Down
In 2025, Republicans will control all three branches of government. And that means this is the first time in two years it makes sense to shut the government down.
That Johnson could not see the obvious is grounds for removing him.
Johnson’s excuses are so repetitively awful that I doubt he survives, and I hope he doesn’t.
On Lifting the Debt Ceiling
Now that Republicans are in total control, there is no need to lift the debt ceiling, is there?
Of course there is.
Trump has no intention of balancing the budget. And if he gets his way on tax cuts without offsetting cuts or income, the deficit will explode.
The fiscal hawk hypocrites (who are only hawks when a Democrat is president), will now suddenly reverse with Trump in the White House.
On October 20, I noted Trump Disavows His Own “Best in History” USMCA Trade Deal
If USMCA was so great, why is Trump now threatening to break it?
On December 15, I asked Should We Take Trump Seriously or Literally on Huge Tariff Hikes?
Onge is taking Trump literally without factoring in any negative ramifications. It’s pie in the sky economic madness.
When It comes to 25 percent tariffs on Mexico and Canada, I take Trump neither literally nor seriously.
Rather, it’s another Mexico will pay for the way type of statement. You might also recall Trump’s insistence that “Trade wars are good and easy to win.”
For a recap of how that ludicrous statement turned out, please see Trump Claims Tariffs Will Reduce the Trade Deficit. Let’s Fact Check.
Trump proposes 60 percent tariffs on China. Would that reduce the trade deficit? Where? How?
December 16, 2024: Trump Proposes Killing the $7,500 EV Credit and Seeks Tariffs on Battery Materials
Team DOGE has no authority to do anything but make recommendations. For all the hype, DOGE has not come up with anything that I would not have proposed.
For example, DOGE wants to eliminate the Department of Education. Great, but this is an idea that been circulation for at least a decade by Ron Paul and others.
The idea will die if four Republican Senators disagree or perhaps if as few as a couple of House members disagree.
Killing the EV subsidy is part of the ridiculously named Inflation Reduction Act. And the auto industry will fight to keep those subsidies.
Can DOGE even deliver something as simple as killing EV tax credits?
Do You Have Any Faith that Sheriff DOGE Will Reduce the Fiscal Deficit?
Yesterday, I asked Do You Have Any Faith that Sheriff DOGE Will Reduce the Fiscal Deficit?
Before you answer, we need to define the word “faith” and the word “reduce”?
If you do have faith DOGE will accomplish much, your faith is misguided.
And now, Trump wants to get rid of the debt ceiling.
Hypocrites who wanted to keep the ceiling will now support the this without a second thought.
There isn’t any limit on the amount of money the government can borrow. They always raise the ceiling. It is the only way to get to 35 trillion and beyond. Pundits are already talking about 50 trillion. The thing about parabolic arcs, is that they complete themselves. They don’t get 40% or so into the arc and things change course. The arc gets steeper and steeper til it is virtually straight up, as if on auto pilot. Then it collapses.
All those billionaires lining up to give Trump money. I guess they just love the Don and have no interest in possible favors. This system is an unfixable mess. Maybe democracy isn’t a good idea?
Every cycle has an up phase and a down phase. There is no good idea, the roaring 20’s lead to the Great Depression. The creation of Glass Steagall lead to the dismantling of Glass Steagall. Armstrong divides his economic confidence cycle into Two 50 year phases. Public cycle and private cycle. It’s like a pendulum that swings back and forth. 1930 and 1980 were inflection points. 1914 started WW1. 2014, was effectively, the start of the war in Ukraine. Everyone is now talking of WW3. Creating the EU was supposed to prevent another European war. The head of NATO just said that The EU needs militarize to prepare for war with Russia, another European war.
Agree 100%. Shut down the government and ALL future bills must be individual. No bill can be combined. Everyone will be forced to vote on the record for individual spending. Also NO pay increase for congress.
I am from Texas. Trump attacking Chip Roy for not wanting to suspend the debt ceiling is ridiculous. Yes, I voted for Trump, because the alternative was unspeakably bad. However, his tweet about finding a primary opponent for Chip Roy just emphasizes his immaturity. Chip Roy does not want to eliminate the debt ceiling, because Chip Roy is trying to be responsible. If Trump were a mature person, he would call Chip Roy and have a discussion with him about the merits and drawbacks of having or not having a debt ceiling and not have a hissy fit on Twitter. I personally don’t give a crap about the Debt ceiling, but it worries me that Trump seems so butt hurt about it being there. Is his plan to spend a lot more money? Is his plan to put us a lot further in debt? Is he a democrat? Maybe I should’ve just not voted. Maybe Texas should just go its own way. The US is turning into Illinois.
You and millions more voted for these monsters. Live with it. Their chaos will destroy the US. You all wanted this.
As I said, the alternative (Kamala/Biden/Obama) was unspeakably bad. Trump’s economic team is looking very promising. The US face is daunting economic issues that the Democrats or unprepared to address. I just don’t like seeing Trump attacking loyal conservatives.
Libertarian candidates are also on the ballots. Balanced budget and paying down the debt are top policies of their platform.
Monsters? Who weaponized the government against a political opponent. It wasn’t the Republicans. Andreessen, a life long Democrat, switched to support Trump, because of Biden’s autocratic dictate on AI.
It was Obama that said he was going to fundamentally change America. What do you think Kamala’s remark of being unencumbered by what has come before, meant? Radical change, like the Cultural Revolution in China, which got rid of the 4 olds.
Excellent observations and analysis! KUDOS! The Founders knew: “The last official act of any government is to loot the treasury.”
George Washington
“No generation has a right to contract debts greater than can be paid off during the course of its own existence.”
Thomas Jefferson
Everyone is thinking this. I’m glad you put it in print so historians will have record.
The hurry is to ensure Democrats get the spending they want before a Republican controlled Senate starts on January 3rd 2025.
Guess he’s not balancing the budget this time either, despite last times promises.
The country will be looted by his cronies though, and that pesky debt limit puts a damper on their looting. They can only steal from a finite number of future generations.
Hes not President. That would be Biden. Try to keep up
EXACTLY! Trump and his corporate cronies are their to raid the Federal spend, not reduce it.
Which is why he wants to get rid of the Debt Ceiling now before he comes to his throne (or rather Musk comes to the throne, and Trump sits as the joker)
Regarding DOGE, I recommend that you watch a YouTube video of a conversation between Shawn Ryan and Joe Lonsdale. Joe is a co-founder of Palantir with Peter Thiel and a venture capitalist in his own right. A young conservative and close with Elon and the other people who are going into DOGE. Joe says that DOGE has at least 100 people (generally data engineers and lawyers) who have specific and detailed plans that will hit the ground on day one in all the governmental departments. These are brilliant people, and they are very aware of what they are up against regarding the permanent deep state in DC.
Obviously, every stop will be pulled out by the Democrats and anyone else whose access to funding and Congressional control of the purse strings and regulatory structure is threatened.
Joe believes that if Trump, Elon and Vivek cannot do anything to bring the changes needed, nobody will ever be able to in the future. I agree with him, though it may be too late.
Are you sure that’s DOGE you’re talking about? It sounds more like Project 2025.
Who’s paying the 100 people?
So it’ll be all sunshine and kitten farts by July? I await this miracle eagerly.
It’s only to enrich themselves, not as some volunteerism effort to the Dog agency to help the country.
For crying out loud, even a child can see what’s going on.
If DOGE really wanted to get us out of debt they’d be against raising or eliminating the debt ceiling. They’d actually say it needs to be continuously lowered.
Agreed! 1000%
Like Newt said, they used government shutdowns to force Dems to the bargaining table back in the 90’s. The fact that we don’t do this anymore is the #1 example of how THE UNIPARTY runs the show.
I have no idea how successful or disastrous Trump will be, but I’ll call it a win if he’s able to shine more and more light on how corrupt Congress is and actually just do one thing:
Pass budgets instead of CRs.
A few thoughts (apart from my suggestions of a few days ago re requiring spending bills to be split by agency and read aloud in session without a break):
1) All legislation should be published online as it is being drafted using version control (cf Github as an example). By this means the public would know exactly who inserted what clause and who made any edits. This costs essentially nothing and would do wonders for transparency.
2) If all they wanted (as many e.g. Johnson and some other defender of the CRomnibus insist) is to give aid to the hurricane victims and farmers, this could be done in two or three pages and could probably be generated by ChatGPT in minutes.
3) Pay them based on *performance* and specifically on doing a proper annual budget. If they can’t manage it then their pay is reduced by, say, 25%. Or better yet, they would be disqualified from running again.
I’m wish Mish — shut it down, burn it down (metaphorically, of course), and start from scratch. Enough is enough.
And instead of “sending all the non-essential workers home”, fire their a**es!
Too good to be true.
Great to know that an unelected oligarch (Musk) is now running the country. Last time the world saw oligarchs in charge of a big country was Russia in the 1990s. Who said history doesn’t repeat itself?
If Musk is able to take power away from the UniParty, then count me in on the Musk-oligarchy. I firmly believe Musk, like Trump, Vance, Vivek, Hegseth, RFK Jr, etc all want what best for America, including the forgotten working class.
Where do you think Elon Musk’s $320 billion net worth comes from, if not from the “forgotten working class”?
If the House was the least bit interested in governing, why hasn’t a budget proposal been made for the last 12 months. Johnson has to go, He obviously lacks any negotiating skills and is at best a lacky for Trump – and not even a good one. Neither is good for the House of Representatives.
Actually he does have negotiating skills, which is why he’s lasted as Speaker.
But he is a lackey for Trump.
There’s a law that says government employees must get full salary after any government shutdown. A shutdown is free money for bureaucrats.
You are correct, and it was signed into law by none other than Donald J Trump
https://en.wikipedia.org/wiki/Government_Employee_Fair_Treatment_Act_of_2019
In my view, the statement below is what this shutdown hoopla is all about.
“…And now, Trump wants to get rid of the debt ceiling…”
If he’s serious (I dont think he is) he’s dumb, but not for the reasons many will think.
The only real purpose the debt ceiling serves is as a bargaining chip for whichever party happens to be in power at the time it is exceeded. It’s purpose as a bulwark against more debt has proven to be laughable at best.
Let’s point out the fake Ruse in EVERY GOP Tac Cut Plan which started with a whooper under Bush. Budgets and Tax Cuts require a 10-yr Fiscal Effect from the CBO. But to get the GOP’s cuts (largely for the wealthy) from showing even higher deficits they came up with Sunset Provisions which FAKLEY roll back the tax cuts in the final year(s). Sure they WOULD bring in more tax money IF THEY DID but no one wants to raise taxes – and typically the 10th yr is early in for a New President – and they don’t want to quickly raise tax rates. So, whomever it is will make them permanent – AND THAT INITIAL BUDGET NEVER HAPPENS B/E THEY ROLLOUT THE FAKE TAX HIKES IN THE ORIGINAL BUDGET.
Like in 2025 when Trump’s LAST tax cut hikes in his budget’s final year WILL AGAIN BE MADE PERMANENT. Exploding the deficit far more than the headline # in his original budget. Did he ever care not to explode the deficit? NO. His tax cuts had PERMANENT CORPORATE TAX CUTS – THEY ONLY THING ENDING NEXT YEAR IS PERSONAL PROPERTY TAXES, Tired of Corporations not paying fair taxes? Ask Trump why he made their cuts permanent in the first place.
Just watch. I bet Trump’s next budget AGAIN HAS FAKE SUNSET PROVISIONS. If we see them you’ll know for sure it’s a BS Fiscally Irresponsible Budget. A FAIR BUDGET SHOULD NOT HAVE FAKE SUNSET PROVISIONS.
The urgency to fund is complete BS. Thank goodness for DOGE.
Doge already killed this bill….no I’m for keeping the debt ceiling but I’m also for a balanced budget amendment
I will voluntarily give up my Social Security in turn for the SS Administration forwarding me the balance of the money in my account so I can invest it myself. You know, that money that’s in the Al Gore Lock Box?
It’s been spent. That’s the point. We are broke. Im not young. But I don’t want to ruin this country for future generations
Didn’t your read your Social Security paperwork? There is no “my/your account” and it’s an INSURANCE program – OASDI (Old Age, Survivors and Disability Insurance) which can be changed at any time by Congress, just like any private insurance program.
The fact that so many people like you won’t take the basic time to understand or acknowledge this is one reason we’re in such monetary constraints
Mish, I’ve followed you for years. Although this wades into politics I thought you gave a REALISTIC and seasoned perspective on things KUDOS on the great realistic insights and comments.
2 things:
1) I realized yr’s ago it is universal that people always want a ‘kinder gentler way”. So, politicians market kinder, gentler tax and fiscal plans that are fake lies (and they know it). How can a good politician compete with false flags? They can’t so most are not.
2.) Centuries ago (even the) Greeks said and documented that “ignorant people” are more common and hurt society way more than [most all] evil people. And sadly, their ignorance is matched by their efforts to mislead the situation and populace. That which they do not know they think they do know. See: Dunning–Kruger effect.
The average IQ in the US is slightly below 100, according to some sources. The range is around 55 to 145. Men have an average IQ of 99, and women 97. That will start some arguments in my household. If you have an average IQ, remember that half the population is dumber than you are. Around 16% of us have an IQ below 85. That’s 56,000,000 of your fellow citizens. Surely, some members of Congress fall into that group.
Stupid people deserve stupid representation.
Well said Mish
Oh well then, debt’s irrelevant and make-believe anyway.
On Lifting the Debt Ceiling
Now that Republicans are in total control, there is no need to lift the debt ceiling, is there?
Of course there is.
Trump has no intention of balancing the budget. And if he gets his way on tax cuts without offsetting cuts or income, the deficit will explode.