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      Bipartisan US debt ceiling talks restart as deadline moves closer – as it happened

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      That’s it for today’s live politics blog!Here’s what happened today:
      Senate minority leader Mitch McConnell has said he will be in the 9 May meeting on the debt ceiling, but emphasized that Biden has to negotiate with House speaker Kevin McCarthy. “There is no solution in the Senate,” said McCarthy to reporters on Tuesday.
      A Florida woman faces two charges of battery – one a felony – after allegedly throwing a drink at the far-right Republican congressman Matt Gaetz.
      Senate majority leader Chuck Schumer has said that Democrats will wait on a 9 May meeting between Biden and congressional leaders to decide if they will move forward on a clean debt ceiling push that would not include spending cuts, but added that Democrats will be pushing for a two-year full extension.
      Illinois senator Dick Durbin said that he wants to move on a bill imposing a code of ethics on supreme court justices, but wants to make sure he has the votes, as California senator Dianne Feinstein remains absent from the Senate following a bout of shingles.
      New York representative Alexandria Ocasio-Cortez said late on Monday that Feinstein should resign, joining a bipartisan chorus calling for Feinstein to step down amid absences from the Senate.
      A new poll puts Donald Trump ahead of Florida governor Ron DeSantis among Republican primary voters in a hypothetical 2024 presidential primary election, as Trump continues to outperform DeSantis in several polls.
      Thank you for reading! Check in for more updates tomorrow!The White House’s economist warned against Republicans “playing games” with the US economy through the debt ceiling debate when interest rate increases are already having an averse impact on the economy, Reuters reports.“The economy remains, it’s been strong. You don’t want to be pushing it off of the course that it’s on,” said Heather Boushey in an interview with Reuters.Boushey added: “The Fed is raising interest rates in the hope of reducing inflation. That is having this negative effect on the banking sector. Why would we add to that?”Boushey noted that raising the debt ceiling could remove the risk of a debt default, one that could take affect on 1 June.A Florida woman was charged with allegedly throwing a drink at the Florida representative Matt Gaetz. The Guardian’s Martin Pengelly reports.
      A Florida woman faces two charges of battery – one a felony – after allegedly throwing a drink at the far-right Republican congressman Matt Gaetz.
      The Walton county sheriff reportedly said Gaetz insisted on pressing charges. Gaetz maintained he was justified in doing so, saying 41-year-old Selena Jo Chambers “cross[ed] the Rubicon beyond just words to throwing stuff”.
      A previous case of a drink being thrown at Gaetz resulted in a woman being sent to prison.
      In 2019, Amanda Kondrat’yev, then 35 and a former political opponent of Gaetz, received a 15-day prison sentence for throwing a slushie at her rival.
      That beverage-blitzing brouhaha happened at an “Open Gaetz” public event at restaurant in Pensacola appropriately named the Brew Ha Ha.
      Read the full story here.Senate majority leader Chuck Schumer has said that Democrats will wait on a 9 May meeting between Biden and congressional leaders to decide if they will move forward on a clean debt ceiling push that would not include spending cuts. Schumer added that he wants a two-year extension of the debt ceiling versus a stopgap measures, the Washington Post reported.Senate minority leader Mitch McConnell has said he will be in the 9 May meeting on the debt ceiling, but emphasized that Biden has to negotiate with House speaker Kevin McCarthy.“There is no solution in the Senate,” said McConnell to reporters on Tuesday.From CNN’s Manu Raju:Many expect McConnell to ultimately help negotiate a bipartisan debt ceiling agreement, as the Kentucky senator did in 2021.But McConnell has maintained that Biden must negotiate with McCarthy and House Republicans about the debt ceiling.Illinois senator Dick Durbin said that he wants to move on a bill imposing a code of ethics on supreme court justices, but wants to make sure he has the votes.CNN’s Manu Raju noted that with California senator Dianne Feinstein out, Durbin is unsure of when he could forward such legislation.“I’d like to make sure we have enough folks to pass it,” said Durbin.Feinstein is a member of the Senate judiciary committee, but has been out due a case of shingles. Durbin confirmed to Raju that he has “not personally” spoken with Feinstein about when she would return.The defense department and the Federal Aviation Administration have been tracking a balloon that was flying off the coast of Hawaii last week, but a defense official said today there’s no indication it is connected to China or any other adversary, and it presents no threats to aviation or national security, the Associated Press reports.The balloon was first detected by radar on Friday.
      Pacific Air Forces launched three F-22s to assess the situation and visually identified a spherical object. We monitored the transit of the object and assessed that it posed no threat,” US Indo-Pacific Command said.
      The defense official said the balloon was floating at about 36,000ft (11,000 meters), and it did not fly over any critical defense infrastructure or sensitive sites.After determining that the balloon presented no threat to people on the ground or to aviation over Hawaii, the military took no action to bring it down, said the official, who spoke on condition of anonymity to discuss military operations.It’s not clear who owns the balloon, which has now passed out of Hawaii’s airspace, the official said.The latest balloon sighting comes about three months after the US military shot down what officials said was a Chinese spy balloon that crossed Alaska and part of Canada before returning to the US and triggering widespread interest as it flew across the country.It was shot down over the Atlantic off the South Carolina coast on 4 February. Large portions of the balloon were recovered by the US military.US officials said it was equipped to detect and collect intelligence signals as part of a huge, military-linked aerial surveillance program that targeted more than 40 countries. Beijing insisted the balloon was just an errant civilian airship used mainly for meteorological research that went off course due to winds and had only limited “self-steering” capabilities.The US military acknowledged there have been several other balloons that have been tracked over and near the US in recent years, but none lingered over America for as long as that one did. The incident further eroded relations between the US and China.At a press conference just now, White House press secretary Karine Jean-Pierre elaborated on what Joe Biden will discuss with House majority leader Kevin McCarthy over the debt ceiling next week:“The president is going to make it clear to them that they have to avoid a default. It is their constitutional duty to do this. It is their constitutional duty to the American people for them to do their jobs. He will also say we will have a conversation about the budget and appropriations, and that is something that he will be very clear about. We can have a conversation about that, but it is important to not default.“The president is going to continue to make that clear. He is going to make that clear and have that conversation.”The Biden administration will temporarily send an additional 1,500 troops to the US-Mexico border as pandemic-related restrictions to migration are set to expire on 11 May.An unnamed US official told Reuters on Tuesday that the additional troops will be part of a supplementary preparation for an increase in illegal immigration as Title 42 comes to an end. Title 42 allowed the US to expel migrants amid the Covid-19 pandemic.The troops will not carry out any law enforcement operations and will assist US border patrol that is currently in the area, said the US official who asked to stay anonymous.The number of Americans listing guns and crime as a top issue for them has increased, according to a new Gallup poll.Of those polled for Gallup’s Most Important Problem list, seven percent said that guns and gun control were a priority issue for them, the Hill reported. Six percent listed crime and violence.In polling done months earlier, only 3% listed crime as their top issue and 1% listed crime.Both issues were listed below problems such as government and poor leadership, immigration and the economy.House Democrats have quietly started taking steps to introduce a rare legislative procedure that could force a debt limit increase and bypass Republican legislation for cuts.The New York Times just reported that Democrats are trying to set up a discharge petition that would allow Democrats to force a bill onto the floor if they get enough signatures – 218. This would mean all 213 house Democrats would need to sign the petition, and five Republican representatives would have to join.Though the House is in recess today, House Dems held a pro forma session and introduced an emergency rule that would give them two weeks, until 16 May, to collect the 218 signatures.Though Democrats see the bill as a gamble, Hakeem Jeffries, Democratic House minority leader, sent a letter to fellow Democrats today expressing a tone of defiance and saying that House Dems “are working to make sure we have all options at our disposal to avoid default”.Oklahoma is the latest state to pass legislation banning gender-affirming care for minors, as several states pass bills targeting the rights of transgender people.The Republican governor, Kevin Stitt, signed a bill on Monday making it a felony for healthcare practitioners to provide children with gender-affirming care, including puberty-blockers and hormones, the Associated Press reported.The bill comes as parents of transgender children, healthcare workers, and transgender people say that such care is essential.“Gender-affirming care is a critical part of helping transgender adolescents succeed, establish healthy relationships with their friends and family, live authentically as themselves, and dream about their futures,” said Lambda Legal and the ACLU in a joint statement, PBS Newshour reported.At least 15 other states have taken similar measures, with over 500 bills introduced in 2023 that target aspects of life for transgender people.A Montana lawmaker is suing the state, Montana’s house speaker, and the sergeant of arms of the state’s house after she was censured, asking to be fully reinstated to her position.House GOP voted to ban representative Zooey Zephyr on Wednesday from the state’s floor, gallery and anteroom after Zephyr, who is the state’s first openly transgender representative, criticized legislators for supporting a ban on gender-affirming care for minors.Zephyr is now suing to be allowed back onto the house floor as she is only allowed to vote virtually. The lawsuit, filed on Monday, argues that limiting her ability to vote violates “free speech and expression rights,” the Washington Post reported.“House leadership explicitly and directly targeted me and my district because I dared to give voice to the values and needs of transgender people like myself,” said Zephyr in a statement.“By doing so, they’ve denied me my own rights under the constitution and, more importantly, the rights of my constituents to just representation in their own government.”We’ve reached the midpoint for today’s politics live blog.Here’s what’s happened so far:
      New York representative Alexandria Ocasio-Cortez said late on Monday that the California senator Dianne Feinstein should resign, joining a bipartisan chorus calling for Feinstein to step down amid absences from the Senate.
      Senate majority leader Chuck Schumer said during a Tuesday speech on the Senate floor that Democrats will only pass a “clean” debt ceiling increase, as a 1 June debt default looms.
      A new poll puts Donald Trump ahead of Florida governor Ron DeSantis among Republican primary voters in a hypothetical 2024 presidential primary election, as Trump continues to outperform DeSantis in several polls.
      Debt ceiling talks have gained a second wind after a warning on Monday by the US treasury secretary Janet Yellen that the US could default on its debt as soon as 1 June, as Biden confers a 9 May meeting with top congressional leaders.
      Here is reporting on the Senate judiciary committee meeting from the Guardian’s Chris Stein, who is currently in the hearing room.Partisan splits were apparent in the Senate judiciary committee today as it kicked off a hearing on the supreme court’s ethics, with Democrats accusing the nation’s highest court of believing itself to be outside the law, and Republicans defending the justices from what they said were attacks motivated by bitterness over its recent rulings.“Ethics cannot simply be left to the discretion of the nation’s highest court,” the committee’s Democratic chair Richard Durbin said. “The Court should have a code of conduct with clear and enforceable rules so both Justices and the American people know when conduct crosses the line. The highest court in the land should not have the lowest ethical standards. That reality is driving a crisis in public confidence in the supreme court.”Durbin called the hearing after a series of reports about entanglements between the court’s justices, particularly its six conservatives, and lawyers and donors with interests in the court’s outcome. Chief justice John Roberts was invited to testify, but declined, instead sending a document signed by all of the court’s nine justices that outlined their approach to ethics.Lindsey Graham, the judiciary committee’s top Republican, said the Democrats were using the hearing to retaliate against justices who authored opinions they didn’t agree with. Last year, the court’s conservatives upended nearly a half-century of precedent by overturning Roe v Wade and allowing states to ban abortion entirely, cut into the Environmental Protection Agency’s ability to regulate power plant emissions and weakened laws on possession of concealed weapons.“This is not about making the court better,” Graham said. “This is about destroying a conservative court. It will not work.”The Senate judiciary committee is holding a meeting to discuss whether the US supreme court should bolster its ethics rules following a series of reported conflicts between supreme court justices and personal interests.The Tuesday meeting comes after several scandals that have called into question the ethics of the court and diminishing public confidence in the institution, the Washington Post reported.Most recently, supreme court justice Clarence Thomas has come under fire after media organization ProPublica publicized that the longest-serving justice accepted luxury travel and vacations over two decades from the real estate mogul and Republican donor Harlan Crow.Such gifts and a real estate deal between Thomas and Crow were undisclosed by Thomas.Ahead of today’s meeting, Chief Justice John Roberts declined an invitation to appear and testify about judicial ethics. The justice instead forwarded a three page “Statement on Ethics Principles and Practices”, which is signed by all nine justices. The non-binding memo is meant to “reaffirm and restate foundational ethics principles and practices to which they subscribe”.But Roberts himself is facing scrutiny after a whistleblower alleged that Roberts’s wife, Jane Roberts, made millions through recruiting for top law firms. More

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      ‘Toxic trail of pollution’: states step up to curb the use of ‘forever chemicals’

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      Few chemicals have attracted as intense public and regulatory scrutiny as PFAS, but even as the highly toxic and ubiquitous compounds’ dangers come into sharper focus, industry influence has crippled congressional attempts to pass meaningful consumer protections.Federal bills designed to address some of the most significant sources of exposure – food packaging, cosmetics, personal care products, clothing, textiles, cookware and firefighting foam – have all failed in recent sessions.However, a patchwork of state laws enacted over the last three years is generating fresh hope by prohibiting the use of PFAS in those and other uses. These laws – mostly passed in Democratic-controlled states – are quietly forcing many companies to phase out the chemicals as they become illegal to use in consumer goods in some of the nation’s largest economies.“We’ve seen some corporate leadership on PFAS, but the actual state policies that say ‘No, you have to do this’ – those are great incentivizers,” said Sarah Doll, director of Safer States, which advocates for and tracks restrictions on toxic chemicals at the state level.PFAS are a class of about 15,000 chemicals often used to make thousands of consumer products across dozens of industries resist water, stains and heat. The chemicals are ubiquitous, and linked at low levels of exposure to cancer, thyroid disease, kidney dysfunction, birth defects, autoimmune disease and other serious health problems.Though the Biden administration is devoting significant resources to limiting and cleaning up environmental PFAS pollution, it has no coherent strategy to address the chemicals’ use in consumer goods, and states have filled that void. Among those are laws banning their use in:
      Clothing/textiles. California, New York and Washington banned PFAS in clothing, while multiple states are prohibiting the chemicals’ use in textiles, such as carpets or furniture upholstery, or in children’s products like car seats and strollers.
      Cosmetics/personal care. California, Colorado and Maryland banned PFAS in all cosmetics and personal care products.
      Food packaging/cookware. About 10 states have prohibited PFAS in some food packaging, and several also bar it in cookware.
      Firefighting foam. At least 15 states have banned or limited the use of firefighting foam with PFAS because it is a major source of water pollution.
      Maine has gone several steps further with a ban on all non-essential uses of PFAS, and the momentum continues this session in 33 states where legislation has been introduced. Vermont’s senate unanimously approved a ban on the chemicals in cosmetics, textiles and artificial turf.The state policies may make it financially and logistically impractical for many companies to continue using PFAS, and their effects could reverberate across the economy.“It would not make sense to not use the cancer-causing chemical in California and New York, but go ahead and use it in Texas,” said Liz Hitchcock, federal policy director at Toxic-Free Future, which advocates for stronger restrictions on chemicals.Among a cascade of companies moving away from the compounds in some or all products are Patagonia, Victoria’s Secret, Target, Home Depot, Lowe’s, Ralph Lauren, Zara, H&M, Abercrombie & Fitch, Calvin Klein, Burberry, Tommy Hilfiger, McDonald’s, Burger King, Rite Aid, Amazon, Starbucks, Whole Foods, Taco Bell and Pizza Hut.Sephora, Revolution Beauty and Target are among those in the cosmetic and personal care sector that have announced phase-outs of PFAS.In December, 3M, perhaps the world’s largest PFAS producer, announced it would discontinue making the chemicals, in part citing “accelerating regulatory trends focused on reducing or eliminating the presence of PFAS”.Companies widely use PFAS despite their myriad risks because they are so effective. The story of outdoor giant REI Co-op is emblematic of industry resistance to phase-outs.In March 2021, a public health campaign began calling out a glaring inconsistency between REI’s virtuous marketing and use of PFAS in waterproof textiles: the company boasted of “responsible production” and advised its customers to “leave no trace” in the wilderness, but sold clothing waterproofed with dangerous PFAS chemicals that the campaign noted left a “toxic trail of pollution”.But that changed in September 2022. California banned PFAS in apparel and textiles, and New York followed soon after. A February REI announcement that it would phase out the chemicals “in part to ensure wide industry alignment with new state laws regarding the use of PFAS” marked a major victory for public health advocates, and a similar story is playing out across the broader marketplace. REI did not respond to a request for comment.Public pressure is also fueling the development. REI faced “immense pressure” from a coalition of more than 100 NGOs and 150,000 co-op members who signed a petition demanding the company eliminate PFAS in the 18 months ahead of the California apparel ban, said Mike Schade, who spearheaded the effort with Toxic-Free Future’s Mind the Store program. Even as REI held out, other companies that Mind the Store approached, like Wendy’s and McDonald’s, committed to eliminating PFAS.The interplay among the campaigns, companies committing to eliminating the chemicals and state laws creates a potent “synergy” and sends pressure in both directions, Schade said.“If we get more companies to act, that builds more political support for action at the state level to regulate and restrict harmful chemicals like PFAS,” Schade added. “At the same time, more states acting will create more pressure on businesses to take action ahead of state policies.”skip past newsletter promotionafter newsletter promotionCalifornia state assembly member Phil Ting’s bills to ban the chemicals’ use in food packaging and apparel drew surprisingly little resistance from industry, he said, which he ascribed to market momentum. Though most companies, like REI, were still using the chemicals, some major names like Levi’s, Whole Foods and McDonald’s had already announced phase-outs, the latter two amid pressure from Toxic-Free Future.“It didn’t seem like government was leading, it seemed like government was supporting what had already started happening in the private sector, and that made it much more palatable for my colleagues,” Ting said.Removing the chemicals and identifying, testing and developing safe alternatives for market production is a slow and difficult process that can take years. Before its March announcement, REI had said the “performance that customers expected” could not be matched by alternatives. Still, other companies managed to phase out the chemicals. Levi’s eliminated PFAS by 2018, but a spokesperson said the “challenge is significant considering that there are currently no equally effective alternatives to” PFAS.Moreover, the supply chain is riddled with PFAS entry points as the chemicals are sometimes intentionally or accidentally added to materials upstream. PFAS are also used as lubricants that prevent machines from sticking to materials during the manufacturing process, and previous testing by the Guardian of consumer products highlighted how that can leave low levels of the chemicals on consumer goods.That can mean that even manufacturers with good intentions may not know their products are contaminated with PFAS, said Christina Ross, a senior scientist with Credo Beauty, a “clean beauty” company. Credo has never intentionally added PFAS to its products and works with suppliers throughout the supply chain to try to avoid adding the chemicals unintentionally. It has found that while some suppliers care about the issue, others do not.“We try to honor those suppliers who do by giving them our money,” Ross said.But that is ultimately an inefficient and unreliable way for entire sectors to eliminate the chemicals, and Ross said it underscores the need for legislative bans. “In order to remove PFAS from any consumer products we have to stop the chemicals from being made in the first place,” she said.That’s unlikely anytime soon at the federal level, where only two out of 50 stand-alone PFAS bills were approved last session, and sources say hyper-partisanship makes passing laws unlikely. States and the US House are passing the measures with bipartisan support, though the laws are largely enacted in Democratic-controlled states.Observers offer two theories on why. The PFAS issue knows no socioeconomic or political boundaries – PFAS contamination is a problem for everyone, Doll noted, and it has hit constituents whom Republicans traditionally support, like farmers and firefighters.Others say Republicans in most Democratic-controlled states don’t have a shot at stopping the bills, so they vote for the measure instead of angering constituents for no political gain.Toxic-Free Future’s Hitchcock said she sells legislators on both sides of the aisle on PFAS legislation by pointing out that banning the chemicals makes sense financially. “We’re paying so much to clean up the mess, why not invest in not making the mess in the first place?” she said.That thinking is partly behind the momentum in the states, but she added: “We can’t depend on just that – we need the federal government and Congress to act.”
      This article was amended on 3 May 2023 to clarify that Credo has already removed unintentionally added chemicals from its products. More

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      Danger and deja vu: what 2011 can tell us about the US debt ceiling crisis

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      Angry at the size of the government debt, House Republicans have passed a bill that ties spending cuts to any lifting of the US’s debt limit. A tense fight is escalating, with Democrats refusing to budge and hard-line Republicans digging in. Without a solution, economists and others warn, the US could be plunged into an “economic catastrophe”.You can be forgiven a sense of déja vu. This has all happened before. Only this time, it could be worse.The federal government has a legal maximum on how much debt it can accumulate –often called the debt ceiling or the debt limit. Congress has to vote to raise that limit and has done 78 times since 1960 – often without fuss. But in recent years, the debt negotiations have become Washington’s most heated – and potentially dangerous – debate.This year’s fight looks like the most high-risk one since 2011, when Republicans used the debt limit debate as a bargaining chip for spending cuts. It was a fight to the bitter end. One former congressman told the New York Times that the battle drew “parallels and distinctions with other tumultuous times such as the civil war”.With stock markets reeling and 72 hours left before the US would have defaulted on its debts, a disaster that threatened to wreak havoc on the economy, Republicans and Democrats finally agreed on a bill that raised the debt ceiling by $900bn and cut spending by nearly the same amount.For Republicans, particularly the new rightwing Tea Party members who refused to budge even as default loomed, it was a political win.Politics are once again deeply embedded in this year’s debt ceiling debate and many see a mirroring of the debt ceiling crisis of 2011.The House speaker, Kevin McCarthy, is caught between his party’s moderate and far-right factions. Though McCarthy rallied his party behind a House bill, Democrats are so far refusing to negotiate.The US treasury is already running on fumes. In January, the treasury started using “extraordinary measures” to avoid defaulting on US debts while the debate over raising the limit started. Some estimate that the US government’s default date – the so-called “X date” when the government officially runs out of funds to pay its bills — will arrive in late July, giving the GOP and Democrats less than three months to find a solution.The US has never defaulted on its debt. Failure to find a solution would send stock markets reeling, recipients of federal benefits might not get their monthly checks, parts of government would grind to a halt and “long-term damage” would be inflicted on the US economy, according to the Federal Reserve chair, Jerome Powell.Fights over the US debt ceiling are common and usually resolved after a session of bloviating. Wall Street has so far ignored this scrap, betting on a repeat. But, as in 2011, all that could change as the X date approaches. This time the Tea Party Republicans have been replaced by even more hardline politicians – the Freedom Caucus – who begrudgingly signed on to McCarthy’s plan but have sworn to hold out for cost cuts no matter the price.“What will damage the economy is what we’ve seen the last two years: record spending, record inflation, record debt. We already know that’s damaging the economy,” Representative Jim Jordan, a founding member of the Freedom Caucus, told Reuters.David Kamin, a New York University law professor who served as an economic adviser to the Obama and Biden administrations, including during the 2011 crisis, said: “Congress has negotiated [the debt ceiling] over the many decades that it’s been in its current form. But what is different about this episode, and the episode in 2011, is the very credible threat from the Republican side to not raise the debt limit, to demand a large set of policy in exchange for a vote.” He added: “That then sets up a dangerous negotiation where what’s at stake is severe repercussions for the economy.”A default would be catastrophic for the US and global economy, creating instability in financial markets and interrupting government services. But, as the 2011 crisis showed, even getting close to default comes with a price. Markets plummeted and the ratings agency S&P downgraded the US’s credit rating for the first time in history, making it more expensive for the country to borrow money. The cost to borrow went up $1.3bn the next year and continued to be more expensive years later, essentially offsetting some of the negotiation’s cost-cutting measures.To some economists, that was just the short-term impact. The spending cuts ushered in years of budget tightening whose impacts were felt for years.“We were still in a pretty depressed economy and in recovery from the great recession when those cuts were instituted. They just made the recovery last far longer than it should have,” said Josh Bivens, chief economist for the Economic Policy Institute, a leftwing thinktank. “Over the next six or seven years, really valuable public goods and services were not delivered because they were cut so sharply.”Government spending tends to rise after recessions but per-capita federal spending fell after the debt crisis. Bivens argues that if government spending had continued at its normal levels, the unemployment rate would have returned to its pre-recession level five or six years before 2017, when the job market finally recovered its losses.This time around the Republican bill, called the “Limit, Save and Grow Act”, would increase the debt ceiling by $1.5tn in exchange for $1.47tn in cuts during the next fiscal year and a 1% spending increase cap thereafter. The Congressional Budget Office estimates that the bill would cut federal spending by $4.8tn over the next 10 years.The bill would mean cuts to things like defense, education and social services over time, though Republicans have outlined few specific cuts in the bill. House Republicans are proposing scrapping Joe Biden’s student relief program, making more stringent work requirements for government benefits, namely Medicaid, and rolling back several Inflation Reduction Act investments, particularly clean energy tax credits.The IRS would lose $71bn in funding under the new bill, a move that would lead to more lenient tax collection and ultimately cost the federal government $120bn over the next decade. Republicans have been targeting the IRS for budget cuts for over a decade, weakening the agency’s tax enforcement over corporations and the wealthy and allowing $18bn in lost government revenue, ProPublica estimated in 2018.While Republicans are using old tricks from 2011, Democrats appear to have learned some lessons from the Obama-era spat. After 2011, the Obama administration refused to negotiate over the debt ceiling. Biden and other Democratic leaders have continued the practice: the Senate majority leader, Chuck Schumer, called the Republican bill “dead on arrival” when it got to the Senate.“President Biden will never force middle class and working families to bear the burden of tax cuts for the wealthiest, as this bill does,” the White House press secretary, Karine Jean-Pierre, said in a statement Wednesday. “Congressional Republicans must act immediately and without conditions to avoid default and ensure that the full faith and credit of the United States is not put at risk.”The question now is: what are the political costs for the Democrats and Republicans? As the crisis deepens, how long will they hold and who will fold?Despite Republicans preaching fiscal discipline, US debt actually rose by $7.8tn under the Trump administration. Spending cuts would also likely target GOP-friendly expenditures. The party has already had to make a tough compromise over ethanol tax credits, which were ultimately left untouched at the behest of “Corn Belt” Republican lawmakers. And McCarthy still lost four Republican votes, the most he can afford to lose with the Republicans’ slim House majority. He has little room to compromise even if he can get Biden to negotiate.Matt Gaetz, a Republican representative from Florida and another Freedom Caucus member, voted against McCarthy’s bill and said in a statement that it would “increase America’s debt by $16tn over the next ten years”.“Gaslighting nearly $50tn in debt to America is something my conscious [sic] cannot abide at this time,” Gaetz said.Kamin pointed out that Republicans only focus on the debt ceiling as a leverage point when there is a Democratic president – the debt ceiling was raised three times during Trump’s presidency – showing that their objective is less about actually reducing the deficit than it is about playing politics.“The Republican party – at least elements of the Republican party – have organized themselves using this as a litmus test for adherence to their beliefs and are really focused on it as a central element of their agenda,” Kamin said. But the fight is “not fundamentally about deficits and debt”, he said. It is a fight about politics.As in 2011, the two sides are locked in a game of chicken and waiting for the opposition to cave. If neither side blinks, the impact on the economy will be felt for years to come. More

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      What is the US debt ceiling and what will happen if it is not raised?

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      The US is teetering on the edge of a fiscal cliff. Over three months ago the treasury warned that the US government had hit its borrowing limit, also known as the debt ceiling. Since then the US treasury has been taking “extraordinary measures” to ensure the government can continue to pay its bills. But time is quickly running out. Congress and the White House have until late summer to raise the debt limit, or else the US government will default on its bills, a historic first, with likely catastrophic consequences.Here is more on the debt ceiling and what it means for the US government:What is the debt ceiling?The debt ceiling is the limit on the amount of money the US government can borrow to pay for services, such as social security, Medicare and the military.Each year, the government takes in revenue from taxes and other streams, such as customs duties, but ultimately spends more than it takes in. This leaves the government with a deficit, which has ranged from $400bn to $3tn each year over the last decade. The deficit left at the end of the year ultimately gets tacked on to the country’s total debt.To borrow money, the US treasury issues securities, like US government bonds, that it will eventually pay back with interest. Once the US government hits its debt limit, the treasury cannot issue more securities, essentially stopping a key flow of money into the federal government.Congress is in charge of setting the debt limit, which currently stands at $31.4tn. The debt ceiling has been raised 78 times since 1960, under both Democrat and Republican presidents. At times, the ceiling was briefly suspended and then reinstated at a higher limit, essentially a retroactive raising of the debt ceiling.What happens if the US defaults?The US has never defaulted on its payments before, so exactly what will happen is unclear. It’s not likely to be good.“Failure to meet the government’s obligation would cause irreparable harm to the US economy, the livelihoods of all Americans and global financial stability,” the US treasury secretary, Janet Yellen, said in a letter to Congress earlier this year.Investors would lose faith in the US dollar, causing the economy to weaken quickly. Job cuts would be imminent, and the US federal government would not have the means to continue all its services.Why is the US debt so high?The US debt grows when the government is spending more money or when its revenue is lower.Throughout its history, the US has had at least some amount of debt. But the debt really started to grow in the 80s, after Ronald Reagan’s huge tax cuts. Without as much tax revenue, the government needed to borrow more money to spend.During the 90s, the end of the cold war allowed the government to cut back on defense spending, and a booming economy led to higher tax revenues. But then, in the early 2000s, the dotcom bubble burst, leading to a recession. George W Bush cut taxes twice, in 2001 and 2003, and then the US military campaigns in Iraq and Afghanistan increased spending by as much as nearly $6tn over the course of the war.When the 2008 Great Recession started, the government had to bulk up spending to bail out banks and increase social services as the unemployment rate hit 10%.When the unemployment rate returned to its pre-recession levels, in 2017, a major tax cut was passed under Donald Trump. The debt rose by $7.8tn while he was in office.And then the Covid-19 pandemic hit. The US government passed a series of stimulus bills to offset the worst of the pandemic’s impacts that ultimately totaled $5tn.What are the main contributors to federal government spending?The biggest chunk of US government spending goes to mandatory programs, such as social security, Medicaid and Medicare, which comprise nearly half of the overall annual budget. Military spending takes up the biggest chunk of discretionary spending, taking up 12% of the budget. Other big-ticket items include spending on education, employment training and services and benefits for US veterans.Why isn’t Congress raising the debt ceiling?On 26 April Republicans passed a bill in the House that would raise the debt ceiling by $1.5tn but mandated $4.8tn in spending cuts over a decade. Given the stakes, Democrats have refused to negotiate spending cuts over the debt ceiling. Lawmakers including Alexandria Ocasio-Cortez have argued that Republicans should bring forth spending cuts during budget negotiations, not over the debt ceiling.Still, Republicans seem adamant on using the high-stakes timeline toward default to pressure Democrats into agreeing to spending cuts. They did this successfully in 2011, when Democrats agreed to spending cuts 72 hours before the government defaulted. This time around, with neither side budging, a continued stalemate could bring the US economy closer to disaster. More

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      ‘Market rules should benefit the majority of the citizenry’: historians Naomi Oreskes and Erik M Conway

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      For the last decade, historians Naomi Oreskes and Erik M Conway have been digging into the history of the idea that freedom only thrives if businesses are left unbothered by governments. It’s a philosophy that has touched every corner of American life, they argue, even though it has long been proven deeply flawed.In their new book – The Big Myth – How American Business Taught Us to Loathe Government and Love the Free Market – Oreskes and Conway document the rise of what’s more politely called “market fundamentalism” over the last century, from corporate propaganda and fringe academic theory to mainstream ideology.The book is both a sequel and a prequel to their groundbreaking book Merchants of Doubt, which is about a handful of prominent scientists who obfuscated clear scientific findings to oppose climate regulation. At the heart of their beliefs, Oreskes and Conway argue, was the big myth.The Guardian spoke to Oreskes and Conway about The Big Myth and how it came to dominate how Americans think about government regulation. This interview has been edited for length and clarity.The Guardian: How do you define “the big myth”?Oreskes: In a way, the myth isn’t just one thing; it’s a set of interconnected concepts that together support this larger ideology of market fundamentalism.The first part of the myth is the notion of the free market, the idea that you could even meaningfully talk about “the free market” as a thing that exists. In reality, people make markets. Markets are human institutions.So that leads to the second part of the myth, which is the idea that markets have wisdom, that the invisible hand guides us and that if we all do our own thing, our own self-interest will somehow lead to this productive, efficient and happy outcome. And therefore, we should just trust markets, that the government distorts markets and interferes with the wisdom of the marketplace.Then the third part of the myth is, in a way, the most damaging – it’s the piece that really informed Merchants of Doubt. It’s this idea of the inextricable link between capitalism and economic freedom as a bulwark against totalitarianism.What are the origins of the big myth?Conway: We pick up the story with business leaders fighting against the regulation of child labor and workplace safety. We’ve all forgotten that there was a crisis of workplace accidents in the United States in the late-19th and early-20th century that killed and maimed hundreds of thousands of peopleBusiness leaders in the United States were absolutely dead-set against doing anything about these twin crises.Oreskes: It’s pretty hard to come up with a good argument to defend the employment of children as young as two in textile mills, which we know happened. How do you defend something that’s clearly, on the surface, really quite appalling? Come up with some kind of argument that appeals to something that we do care about, that we value: freedom.We saw this in Merchants of Doubt, when we talked about the tobacco industry and how it mobilized this whole argument about the freedom to smoke, that you don’t want the government telling you what to do. We actually thought the tobacco industry invented that strategy. But they didn’t. What we show in this new book is that it goes back much further.In the 20th century, one of the things the market fundamentalists did was rewrite US history to invent a story about how free enterprise was embedded into the very foundations of American society, economy and culture.They do this in the 1930s through a metaphor they came up with called the “Tripod of Freedom.” This was pushed by the National Association of Manufacturers (NAM), which at the time was the largest trade organization in the United States. They claimed that the United States was founded on three essential principles that were like a tripod – if any were to be compromised, the whole structure would fall. The three pillars were representative democracy, the Bill of Rights and free enterprise. The third part was a complete invention because, actually, free enterprise appears nowhere in the Constitution or in the Bill of Rights. Nowhere in the Declaration of Independence.The book covers the extensive propaganda campaign from NAM and companies like General Electric to sway the American public against government regulation of businesses. Why were these campaigns so effective?Conway: They disguised propaganda as entertainment, it was not obviously partisan or political. That was the whole idea. Propagandists need a kernel of truth in order to be successful. The best lies are ones that are built on something people already believe.They basically doubled down after the second world war when corporations could control their own advertising again. They keep doing it for decades. If you’re hammered through every outlet with the same message over and over again, eventually you start to believe it. Even if, once upon a time, you realized it was garbage.You have a whole chapter on Little House on the Prairie, Laura Ingalls Wilder’s best-selling books that became a hit TV show. I imagine many people didn’t know it was largely written with the help of her daughter, Rose Lane Wilder, a staunch libertarian. Though the books are supposed to be about Ingalls Wilder’s true childhood, Lane Wilder fictionalized much of it to expound on the ideals of individualism.Oreskes: There are people out there who are mad at us for bursting that bubble. My defense? Actually, we didn’t burst the bubble. Other historians, Caroline Fraser and Christine Woodside burst that bubble, and we’re drawing from their work.In the first chunk of the book, market fundamentalism is fighting an uphill battle. At what point did market fundamentalism start taking hold and becoming mainstream?Oreskes: A key figure in this story, obviously, is Ronald Reagan. Most Americans know that Reagan was an actor before he became a politician, but what they don’t know is how he affected that transition.Reagan’s career was not doing all that well, but he was still a Democrat. He was the president of the Screen Actor’s Guild. But then he gets this job with GE, and the job has two parts: hosting General Electric Theater and promoting General Electric ideology through speeches. It’s pretty clear that during this period, his political outlook shifts to be very, very aligned with GE. So he comes out of GE with this new political ideology, quite different than what he had before he went in. Also critically, he comes out with a set of wealthy corporate backers who then finance his run for governor of California.But you make the point that it wasn’t just Reagan.Conway: When Jimmy Carter becomes president, he brings into office a new generation of economists, many of whom have now been educated with the ideas of free markets that have been pushed into academia by the Chicago School of Economics. They begin shifting the way the government manages the economy. They are the regulators Carter brings into office, the first people we now associate with Reagan and ending with Bill Clinton, who finishes the job of deregulating banks in the late 1990s.Orenskes: We see how this language, rhetoric and ideology gets taken across the board politically so that when Bill Cinton gives his State of the Union address in 1995, he says: “The era of big government is over.” And that’s a Democrat, right?So how does that happen? Milton Friedman said one of the jobs of intellectuals is to be standing ready with ideas. And you just work on your ideas and you get laughed at for a long time. But one day, the world is ready and then you’re there. So when the crisis, the postwar 1970s stagflation develops, nobody really has an explanation for why this has happened. There are probably multiple factors – but the right wing is now standing ready saying: “Oh, the problem is too much government. The problem is big government. The problem is overregulation.” That gains traction, in part because it’s a simpler explanation to a complex problem.Does it seem like market fundamentalism’s grasp is loosening? Are the tides changing?Oreskes: After the Silicon Valley Bank failure, there’s this big conversation taking place right now about how much of that was allowed to happen by weakened regulation, particularly because there were specific regulations that were weakened during the Trump administration.I think most people still see regulation as a necessary evil – even liberals and progressives. So they’re sort of apologetic about it. “Yeah, I know it’s bad. But you know, we have to do it.” I would like to try to change that conversation, to make people think much more in terms of regulations as the rules of how markets operate.At the end of the book, we make a point about biological regulation. Without biological regulation, all life would cease to exist because an organism cannot operate unless it can regulate its internal chemistry. Biological regulation makes life possible. I think that’s true of society as a whole. The right set of rules and regulations supports a vibrant economy where people can “live well and prosper” (you know, Star Trek).Conway: The question is, who are the rules set up to benefit the most? Business leaders want the rules of the road to benefit them, and we’re arguing that no, the rules of the market should benefit the majority of the citizenry, not just the business leaders. More

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      Pacific trade deal is more useful to Joe Biden than it is to the UK’s economy

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      Tory MPs hailed the UK’s entry last week into the Indo-Pacific trading bloc as a major step on the road to re-establishing Britain as a pioneer of free trade.It was a coup for Rishi Sunak, said David Jones, the deputy chairman of the European Research Group of Tory Eurosceptics, who was excited to be aligned with “some of the most dynamic economies in the world”.Trade secretary Kemi Badenoch also used the word “dynamic” to describe the 11 members of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). She pushed back against criticism that signing a trade deal with a loose collection of countries on the other side of the world would only add 0.08% to the UK’s gross national product, and then only after 10 years of membership. That figure was an estimate by civil servants 10 years ago, she said in an interview with the Daily Mail. The CPTPP is more important these days.And it might be, but not for the trade it facilitates. The significance lies in the geopolitical realignment it promotes and how such pacts could harm future Labour governments.The CPTPP was signed on 8 March 2018. Australia, Brunei, Canada, Japan, Mexico, New Zealand and Singapore were the first to form a bloc before being joined in the five years that followed by Vietnam, Peru, Malaysia and Chile.Former president Barack Obama hoped the US would also be a founder member before coming up against a Republican Congress that disagreed. Later, Donald Trump abandoned the deal altogether.Obama wanted to throw a friendly arm around Pacific countries threatened by China’s increasingly aggressive attitude to its neighbours – or, looked at another way, maintain open markets for US goods and services across south-east Asia in opposition to Xi Jinping’s Belt and Road investment initiative. Joe Biden, despite having control of Congress, refused to consider reopening talks about US membership, paving the way for China to apply in 2021.Thankfully for Biden, Britain’s application preceeded Beijing’s by six months, putting the UK ahead in the queue; quickly it became apparent that Britain’s role could be to help block China’s entry to the CPTPP without the US ever needing to join. For the Americans, the potential loss of trade was a side issue.Brexit was never considered by Washington to be a positive development, but there was a silver lining once it became clear the UK could be deployed more flexibly in a fight with China – a confrontation that Brussels has so far backed away from.The Aukus defence pact between Australia, the UK and US is another example of this anti-China coalition – and of Sunak’s efforts to win back Washington’s approval.The move also plays to a domestic agenda. In the same way that Margaret Thatcher’s sale of state assets – from council housing to essential utilities – denied Labour the means to directly influence the economy without spending hundreds of billions of pounds renationalising those assets, so global trade deals undermine Labour’s promise to use the state to uphold workers’ rights and environmental protections.Secret courts form the foundation stone of most trade deals and allow big corporations to sue governments when laws and regulations change and deny them profits.Badenoch’s civil servants say they are comfortable with the investor-state dispute settlement (ISDS) tribunal system because the UK government has never lost a case.However, a government that wanted to push ahead at a faster pace with environmental protections, carbon taxes, or enhanced worker’s rights might find themselves on the wrong end of a court judgment.The TUC’s general secretary, Paul Nowak, was quickly out of the blocks to voice these fears when the deal was announced on Friday. That is why the EU parliament has forced Brussels to ban ISDS clauses from future trade deals.Sunak, on the other hand, appears comfortable with the prospect of CPTPP countries beginning to dictate how the UK considers basic rights – and how this could become the price of easier trade, and more importantly, foreign policy. More