Facebook Instagram Twitter YouTube

The Debt Ceiling Agreement is an Attack on the Working Class and on the Planet

Joe Biden and Kevin McCarthy’s deal to raise the debt ceiling is a handout to the military industrial complex and an attack on the working class and the planet. Rather than just raising the debt ceiling, a relatively standard practice that allows the U.S. to pay the bills for spending that already happened, this debt ceiling deal caps discretionary spending on everything but “defense” and fast-tracks the Mountain Valley Pipeline.

Facebook Twitter Share
Image by the Economist, Satoshi Kimbayashi

After weeks of backdoor negotiation, the deal to finally raise the debt ceiling and avoid a catastrophic default was passed by the House on Wednesday with defections from some Republicans and Democrats — 71 Republicans and 46 Democrats opposed it. The bill then passed the Senate on Thursday evening, only after concerns about inadequate Pentagon funding were quelled with promises that emergency supplemental funds could be negotiated by the Senate at any time in the future. Alexandria Ocasio Cortez, Bernie Sanders, and much of the progressive wing of the Democratic Party voted against it, arguing against the de-facto cuts to social programs. Biden will sign the agreement in the next few days.

A default on the U.S. debt would have destabilized the global economy, been a blow to the U.S. economy by downgrading the U.S. credit rating, and would have resulted in the delay of social security and other necessary payments. Both the Democrats and the Republicans have cheered this deal; Biden and the Democrats because the bill averted a default and didn’t cut as much as the Republicans wanted, and the Republicans because a routine procedure became a mechanism to implement austerity. 

This debt ceiling deal highlights yet again that the Democrats are not the lesser evil. Rather than act as a brake on the right wing attacks against the working class and the planet, the Democrats enthusiastically sign on to those attacks and call it a win. After all, it is a win for the capitalist class who want the working class to pay for the crisis. To fight the attacks against us, we will need a party of our own. 

What’s in the Deal 

This deal, meant to stave off an economically catastrophic default, is essentially nothing more than a cut to future social spending. It caps non-defense spending in 2024 and increases it by only 1% in 2025. With inflation, that will amount to devastating cuts for areas like public education, transportation, and other vital social services, all of which have already been under-funded for decades. This is an attack on working people disguised as fiscal prudence.  

The deal also includes work requirements for access to food stamps. Although work requirements already exist, the debt ceiling deal increases the age where work requirements for food stamps are no longer required from 49 to 55. In essence, this will result in making it even more difficult for older, low income people to access help in getting food. The Food Research & Action Center says that “the expansion of cruel, harsh, and arbitrary time limits on the Supplemental Nutrition Assistance Program (SNAP) for older unemployed and underemployed adults struggling in the labor market will only deepen hunger and poverty.” In the richest country in the world, this deal makes it harder for older people to get nine dollars a day for something to eat.  

Workfare has been a pillar of the right wing agenda for decades, used to make sure that people are essentially starved into accepting low wage labor. Ideologically, it is based on the myth that welfare recipients are “lazy” and just need to get a job. One of the major workfare initiatives was created and supported by the Clinton administration: the welfare to work initiative in 1996 (The Personal Responsibility and Work Opportunity Reconciliation Act). After the “great resignation” of 2021 and in the midst of a unionization wave, this is a small, but significant step towards more draconian welfare to work policies. 

This deal will also end the pause on student debt payments — forcing people to begin repayments of student loan debt as soon as September. This comes as we wait on the Supreme Court to rule on the $10,000 loan forgiveness passed by the Biden administration. Given the conservative makeup of the court and the lack of mobilization in the streets, it is more likely than not that the Supreme Court will overturn this loan forgiveness. 

While the Biden administration promised that student debt would be forgiven under his administration, this debt ceiling agreement will force the 40 million people who owe student debt to begin repayments — a major financial burden for the working class, especially in the context of high inflation. 

Furthermore, this deal includes fast-tracking the Mountain Valley Pipeline, which will be used to ship fracked gas across the world. It will destroy over 1,000 streams and wetlands and will hurt already struggling communities in Appalachia. The Oil Change International reported that the Mountain Valley pipeline would result in 89m metric tons of pollution annually — the equivalent of 26 new coal power plants a year. This is a  project pushed by Joe Manchin, whose major campaign donors are fossil fuel interests. 

There is Always Enough Money for the Military

While this bill to raise the debt ceiling shrinks social spending, it increases resources to grow  the already massive military industrial complex even further. This debt ceiling deal allows military spending up to $886 billion in 2024, in line with Biden’s proposal for a 3% increase in military spending. 

And this doesn’t even include the massive “aid” sent to Ukraine for the proxy war with Russia — which is over 75 billion dollars alreadyAnd already both Democrats and Republicans are seeking to increase military spending by using emergency funding for Ukraine in order to grow the Pentagon budget. Biden himself is already saying that he is open to more military spending through a supplemental bill.  

The United States already has the largest military in the world, spending more than the next ten countries combined in 2022. They use this insane budget to drop drone bombs on children, to support coups, to massively contribute to climate change, and to act as a threatening global force with about 750 military bases around the world in more than 80 countries

This massive military buildup is aimed at the strategic competition and conflict with China in the context of increased geopolitical tensions. The massive U.S. funding for the war in Ukraine is an attempt to shore up U.S.-led NATO influence in Europe in the context of the decline of U.S. imperialist hegemony. And the United States will attempt to wield its military strength in order to attempt to curb China’s rise, deter the expansion of Chinese capital, or worse — prepare for a possible future military conflict with China. This is evident with the increased U.S. military presence in the Philippines and the South China Sea. The goal behind perpetually increasing the U.S. military budget is to use the military to stop the possibility of a multi-polar world. 

This entire debt ceiling debacle is a show of a global hegemon in crisis. Biden even had to cancel his trip to Australia and Papua New Guinea in order to come back to the United States. to negotiate with Republicans. The fact is that the entire global economy hangs in the balance of a country that cannot get its shit together. Even Foreign Policy magazine had to highlight:

The proposed compromise itself is by no means something that should inspire confidence in America’s leading role in the world. In fact, it is a severe indictment…. The bigger point is that when a rich and powerful country finds it easier to cut back on the way that it invests in its people, in education, in science, and in making sure that the weakest among them are not completely left behind than to curtail useless and profligate weapons spending, there are reasons to worry about the foundations of its power.

The debt ceiling debacle and the cuts to social spending highlight a country — and the world’s reigning imperial power — in crisis.

The Biden Administration is Overseeing a Massive Attack on the Working Class

In the domestic sphere, it is clear that the debt limit bill is an attack on the working class, and it’s not the only one. We’re watching as the Fed comes very close to manufacturing a recession by raising interest rates, seeking to expand unemployment. And we’re watching as workers’ wages are devalued by inflation month by month.

While Biden promised to govern for the working class and touted his large spending plans in his first few months in office, he was overseeing a cut in social spending. 

Biden and his ilk argue that this debt ceiling agreement is “not as bad as it could be.” This is essentially the calling card of the Democratic Party. It’s a politics of lowered expectations and defeatism. It’s no wonder that whole sectors of people are being driven into the arms of the far right, while others are dropping out of politics altogether. 

The truth is that when Biden and others say there is no money, that is a lie. We know where the money is. It’s going to the military industrial complex to line the pockets of Raytheon and Lockheed Martin. And it’s in the pockets of the billionaires who get wealthier by the day. 

While the Democrats do a song and dance of claiming to fight for the working class, they are showing their true colors once again. The debt ceiling deal wasn’t a political miscalculation. It is a win for the capitalist class, who have averted a default on the backs of workers. The Democrats are overseeing austerity against the working class in light of a looming recession and in a competition with China, while at the same time attempting to put the responsibility on the Fed, the economy, and the Republicans in order to win working class votes come 2024.

While the planet warms and the effects of climate change become irreversible, Democrats attempt to act as though they are the lesser evil, compared to the science-denying far-right politicians in the Republican Party. But while the Democrats claim to fight climate change, Biden has so far outpaced Trump in approvals for oil and gas drilling projects. And with the current bill, he is now fast tracking a massive fossil fuel project. The Democrats are not the lesser evil for the planet either. 

We Need Our Own Political Party 

The debt ceiling bill has passed, and while some progressive Democrats voted against it, these votes are symbolic. They are meant to feign opposition in a context in which the debt ceiling agreement was going to pass regardless of their vote. If they were serious about opposing the cuts to social spending and ballooning of the military industrial complex, they would have actively organized to tank this debt ceiling deal. 

Once again, the Democrats have colluded with their so-called opposition in the Republican Party to oversee and institute policies that will directly hurt working and oppressed people across the country, all the while telling us we should be thankful it’s not as bad as the first catastrophic Republican plan. 

The Democratic Party is not and cannot be a tool for working class people, and that its primary role will always be to protect the profits of the bosses and to institute attacks on working people and the planet. But we do not need to accept “it could be worse” on a burning planet of wealth hoarded by a tiny number of people. We need a working class party –- by and for working people –-  to fight for our interests. Such a party would have been able to organize and build mass protests against this austerity debt ceiling deal long before it ever made it to the floor of the Congress, necessarily changing the calculations of both capitalist parties by showing the power and will of the people. We need a party that fights not only against these attacks, but for the future of the planet and a society run for the wellbeing of people, not profit. In other words, we need a working-class party that fights for socialism. 

Facebook Twitter Share

Tatiana Cozzarelli

Tatiana is a former middle school teacher and current Urban Education PhD student at CUNY.

United States

The Deadliest Year for U.S.-Mexico Border Crossings Occurred during Biden’s Administration

The humanitarian crisis at the border was created by capitalism. Voting for a lesser evil won’t save the Latin American working class; it will take international, political and strategic solidarity across borders to build a combative immigrants’ rights movement.

Paul Ginestá

September 28, 2023

Scabs Will Not Pass: Defend the UAW Strike With Organized Grassroots Power

The Big Three are escalating their use of scabs. The rank and file are fighting back.

Jason Koslowski

September 27, 2023
NYC Mayor Eric Adams stands at a podium.

The Housing Crisis and Migrant Crisis Are Crises of Capitalism

As thousands of people come to the U.S. seeking shelter, politicians around the country are claiming that housing in the U.S. is already in crisis and that there is no room for them. Both the “migrant crisis” and “housing crisis” are crises created and exacerbated by capitalism.

Mike Pappas

September 20, 2023

To Win, the UAW Strike Must Be Organized from Below

The strike at the Big Three has put the working class at the center of national politics. The autoworkers’ demands are bold and touch on issues of growing exploitation across the country. To win big, the strike must be organized from below.

Tristan Taylor

September 18, 2023


The Big Three Are Using Layoffs to Punish the UAW and Undermine the Strike

The Big Three are retaliating against the UAW by laying off thousands of its members at plants across the country. Defeating these attacks will require the self organization and mobilization of all the workers.

James Dennis Hoff

September 28, 2023
President Biden visits striking UAW workers in Michigan.

Biden’s Picket Line Visit Doesn’t Mean He Is On Our Side

President Biden’s visit to the UAW picket line shows the strength of the strike — and why it should remain independent from him and the Democrats.

Tatiana Cozzarelli

September 27, 2023

Toward a Revolutionary Socialist Network

In this article Warren Montag and Joseph Serrano respond to our call for a network for a working-class party for socialism. 

Warren Montag

September 27, 2023

China’s Rise, ‘Diminished Dependency,’ and Imperialism in Times of World Disorder

In this broad-ranging interview, originally published in LINKS, Trotskyist Fraction member Esteban Mercatante discusses how recent global shifts in processes of capital accumulation have contributed to China’s rise, the new (and old) mechanisms big powers use to plunder the Global South, and its implications for anti-imperialist and working-class struggles today.

Esteban Mercatante

September 22, 2023