McCarthy’s National Debt Fecklessness

Even after years of writing about politics, the depth of the contempt some officeholders have for the people who put them in power and whom they are supposed to serve still stuns me.

The costly—and perhaps soon-to-be tragic—showdown over raising the federal debt ceiling is one of those times.

The disingenuousness and hypocrisy displayed by U.S. House Speaker Kevin McCarthy, R-California, and the firebreathers in the House Republican caucus is astounding. The things they are willing to conceal, even to lie about, reveal how little they care about the concerns of their constituents.

They suggest, for example, the debt is held by faceless entities, likely foreign. They fulminate about China and the threat that nation poses to the U.S. economy.

The reality is that the overwhelming bulk of our nearly $32 trillion national debt—78 percent—is owed to the American people.

A little more than $6 trillion of it is in federal reserve notes. Another $2.6 trillion or more is in mutual funds. Just under $2 trillion is in pension funds. Banks, savings and loan operations and insurance companies hold another $2.2 trillion. And, together, state and local governments and possessors of savings bonds own around $10 trillion of our debt.

Foreign interests do have some of it.

Japan has a little more than a trillion, China a bit less than a trillion and the United Kingdom just under $700 billion. Another 30 or more countries own much smaller pieces of our debt with Belgium leading the pack at about $325 billion.

What does this mean?

Well, when our leaders play games with the notion of defaulting on the debt, they won’t just be sticking it to others.

They’ll be stiffing us.

They’ll be refusing to pay back the money we loaned them in good faith, many of us planning to use the interest on those loans to fund retirements, put children through college, care for elderly parents in their old age or buy homes. They’ll be sacrificing our interests to serve other masters.

This is where the hypocrisy comes in.

McCarthy and his cohort—I can’t call them his followers because there’s a legitimate question regarding who is leading whom in the House Republican caucus—say they’re holding the debt ceiling hostage and flirting with the default because they’re worried.

Terribly worried.

What they fret about, they claim, is the way the debt has grown because of ongoing federal budget deficits.

What they refuse to acknowledge, though, is the role their own actions and policies played in that trend.

Nearly a third of the more than $30 trillion in national debt is the product of the tax cut packages adopted during the presidencies of George W. Bush and Donald Trump and favored by Republicans in Congress.

Those tax cuts were tilted heavily toward the wealthy. The theory was that the wealthy would reinvest in the U.S. economy and the resulting growth from that investment would erase the deficits.

We’re more than two decades and $10 trillion in additional debt into that experiment.

So far, it isn’t working.

If those tax cuts hadn’t been adopted, tax revenues would have kept pace with spending and the debt ratio—the percentage of the economy for which the debt accounts—would be declining.

The fervor with which McCarthy and crew, though, approach the tasks of deficit and debt reduction does not extend to rolling back any of those tax cuts. They will fight to the bitter end to make sure that the uber wealthy still can afford that desperately needed fifth luxury yacht.

McCarthy and his gang love to tout that they’re remodeling the Republican Party, transforming it away from being the party of Wall Street into the party of Main Street.

Where do they think the people with those pensions, mutual funds and savings bonds live? Who do they think is going to be hurt the most by a national debt default—the poor beleaguered billionaire or the retiree trying to live on a lifetime of hard-earned invested savings, the multinational corporation or the family trying to pay for their kids’ education?

The fact is that McCarthy and his feckless bunch seem to care not a bit about the damage they’re doing to the very citizens who gave them control of the people’s house.

There’s only one word that can describe that level of contempt.

Stunning.