With debt standoff, libertarianism hits the ceiling

House Republicans, who refuse to raise the debt ceiling without a spending freeze, have persuaded themselves (ignoring their own economists) that defaulting on the national debt might not produce a catastrophic depression. Here, as with climate change, wishful thinking has led them to delusion. The wish that begot the thinking is the notion that reducing the size and scope of government will make us freer.

I just published a critical history of libertarianism. The ideas that undergird Republicans’ demands are the ones I warn about in my book: apocalyptic pessimism about government, irresponsible vagueness about what will take its place. The book aims to be a kind of Narcan for the many who have consumed toxic levels of libertarian ideas.  The debt standoff shows its urgency.

The Republican bill, which authorizes the federal government to pay the debts it has already incurred but freezes spending at 2022 levels, is called the “Limit, Save, Grow Act.” Its rationale, House Speaker Kevin McCarthy (R-Calif.) explained, is to “lift the debt limit, limit government spending, save taxpayers money, and grow the economy.”  (Meanwhile, the markets are terrified.)

The bill doesn’t say what spending it would freeze. Congressional appropriations committees would eventually have to make those decisions. This is politically clever, because it creates plausible deniability for most of the specific cuts that the bill entails: Don’t worry, we’ll cut something else. This vagueness is also revealing: Minimal-state libertarians tend to rail against government without looking too closely at the details of what government does.

If one examines those details, the bill’s effects aren’t pretty. Because it exempts the Pentagon, veterans’ services, Social Security and Medicare, the only remaining targets are health care, science, education, climate, energy, border and airport security, labor and medical research — which must overall be cut by 22 percent.

The Biden administration estimated the effect: FBI agents would have to be furloughed.  Cuts in the Federal Aviation Administration would reduce the number of air traffic controllers and produce more flight delays. The National Weather Service would become less accurate. There would be fewer rail safety inspections. Pell Grants for low-income college students would be cut. (Disclosure: Those grants helped me attend the University of Chicago.) Housing and child care assistance would be cut off for many.

The bill is not wholly lacking in specifics. It demands that major parts of Biden’s climate law be repealed and fossil fuel production accelerated. Many libertarians have been denying climate change for decades. 

Without the activism of the Koch brothers America might have begun addressing the issue in the 1990s. The disaster that they then refused to believe in might not now be happening. The bill also cuts funding for the Internal Revenue Service, a move that would increase the federal debt by $120 billion in the next decade, but which is consonant with the fantasy of having no government and never having to pay taxes. 

New work requirements would reduce access to Medicaid and food stamps, mostly for genuinely eligible people who will be baffled by the paperwork.

Because the costs of programs rise with inflation, the bill would save about $3.2 trillion, according to the Congressional Budget Office. The talk of growing the economy implies that none of those cuts would have an economic cost. But America’s growth is not the product of a minimal state. The iPhone, for instance, is a triumph of modern capitalism, but its major components (GPS, lithium-ion batteries, cellular technology, LCD and touch screen displays, connectivity to the internet) were created by research that was either funded or directly conducted by the government.

The national debt is, of course, a problem. One solution that the Republicans won’t consider is any increase in taxes. On the contrary, they have said that their first priority is to make the Trump tax cuts for the rich permanent.

One is tempted to say that the Republican Party has been captured by its extreme wing.  But even the moderate wing (which was humiliated in its negotiations with the leadership) isn’t so moderate on the spending question. Sen. Mitt Romney (R-Utah) has been notably sane on many issues, but when he was a presidential candidate, he said:  “Did you know that government, federal, state, and local, under President Obama, has grown to consume almost forty percent of our economy? We’re only inches away from ceasing to be a free economy.” 

Would we really be freer without public schools, roads, bridges, Social Security, police, firefighters and environmental protection? Of course much of this is politically untouchable, so the drive for small government inevitably focuses on spending that has no powerful protectors — public goods that benefit everyone in general and no one in particular. That explains why, for example, President Trump decided to save money by disbanding the federal pandemic response team shortly before the outbreak of COVID-19.

Bad philosophy makes it impossible for Congress to do its job. The only way to fix this is to confront the arguments for libertarian philosophy and see whether it really is a recipe for freedom. It isn’t. 

Andrew Koppelman, John Paul Stevens Professor of Law at Northwestern University, is the author of “Burning Down the House: How Libertarian Philosophy Was Corrupted by Delusion and Greed” (St. Martin’s Press). Follow him on Twitter @AndrewKoppelman.