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Given these constraints, what are the best political moves for congressional Dems to make? Is “permitting reform” the only realistic bipartisan win Dems could net by cooperating? Should they just pull the Republican card of budget brinkmanship and be ok with burning the house down, now that we know that voters blame the president and not the minority party for any chaos?

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Aside from permitting, I think it would behoove Democrats to cooperate on some sort of immigration enforcement reforms, for example changes to tighten up the asylum process similar to those that were included in the Lankford bill. The asylum mess is very unpopular and they should not be seen standing in the way of fixing it.

But the main thing Democrats should do is withhold their votes from partisan bills and watch Republicans struggle to pass anything with their bare House majority. I think we'll see that, on spending bills, it's not just the Senate where Democratic votes will be required to get anything done -- spending packages will only get through the House with Democratic help, and so Democrats will have a seat at the table.

I don't think Democrats stand to gain from "budget brinksmanship" because (1) they care way more than Republicans do about the government dysfunctions that are caused by shutdowns and budget uncertainty and (2) the debt limit does not create independent leverage on spending, separate from the need to vote on spending bills. It's important to note, Republicans can (if necessary) raise the debt limit without any Democratic votes, either by creating a one-time filibuster exception for it (as Dems have already done in the past) or by raising the debt limit as part of a budget reconciliation bill.

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[popcorn gif] can’t wait to see our Republican statesmen navigate the complex tradeoffs of entitlement cuts, tax cuts, and inflation.

Separately, there needs to be a Substack betting pool for how many Scaramucci’s each Trump cabinet pick will last.

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It’s political malpractice that they don’t just eliminate the filibuster given that the current version of the Democratic Party essentially cannot win the senate, although the current version of the Republican Party is also probably too dumb to realize the benefits to doing so (Mitch McConnell in his prime would look at a situation like this and eliminate the filibuster without a second thought, after some fake negotiating and then a saddened statement that his hand was forced).

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Is it the case that the American Rescue Plan contributed significantly to inflation? If so, why hasn’t the US seen significantly larger rates of inflation than our peer nations? I don’t doubt it did contribute, but I’m not sure how significant it was economically.

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Josh, do you think the TCJA was a good bill on balance? Did it stereotypically benefit the rich, or was the pro growth aspect of it genuinely beneficial for the working and lower class? (Obviously they didn’t cut spending enough so it increased the deficit.)

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My general view is that it was bad that the TCJA grew the deficit and made the tax code more regressive. I also think the tax break for pass-through corporation owners was unjustified both distributionally and structurally. But a number of the other structural features were good -- it was good to move toward lower rates and a broader tax base, both in the individual and corporate income tax codes.

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Thanks!

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