Rather than politely allowing Congress to raise the debt limit with no caveats, as they have so many times before, President Trump could use the debt limit increase as a way to force Congress to pass some reforms. Cato Institute senior fellow Dan Mitchell suggests a spending cap or entitlement reform as possible places Trump might pressure Congress. He writes:
Let’s close by indulging one of my fantasies. If Donald Trump wanted to force good policy from Congress, he could threaten to veto any debt limit that wasn’t accompanied by something desirable such as a spending cap or entitlement reform. The politicians on Capitol Hill would balk of course, but Trump could shrug his shoulders and start “prioritization” once the debt limit was reached. So long as all bondholders received promised payments, there would be no danger to financial markets. By contrast, however, the various interest groups feeding at the federal trough would begin to squeal once their checks started slowing down. At some point, Congress would be forced to capitulate.
I’m not holding my breath for this to happen, but it’s nice to dream. Especially since a big fight over the debt limit today (if successful) could save us from something far worse in the future.
Read more from Dan here.