AILSA CHANG, HOST:
Well, as warned, it has happened. Today, the U.S. has maxed out its credit cards. Or, to put it in the words of Treasury Secretary Janet Yellen, the country has reached its debt limit. So extraordinary measures are now being used to avoid a default. And that means the familiar political fight over the debt ceiling, which is currently around $31.4 trillion, heats up. Democrats want to raise the debt ceiling, but Republicans want to cut spending in exchange for their votes. We're joined now by someone at the heart of this fight, Republican Congressman Don Bacon of Nebraska. Welcome.
DON BACON: Thank you for having me on.
CHANG: Well, thank you for being with us. So I just want to lay out the stakes here because, to be clear, the U.S. has never defaulted on its debt. So these so-called extraordinary measures will buy maybe a few months. But if a default happens, economists, of course, predict that the markets could tumble, which would hit people's retirement accounts pretty hard. And the last time there was a showdown over the debt ceiling, I mean, the U.S.'s GDP dropped 1%. So let me just ask you, where do negotiations stand right now? I mean, are Democrats and Republicans in the House even talking to each other?
BACON: Not yet, unfortunately. And I totally agree that a default would be bad for our country, bad for economy. We're the world's superpower. And we don't default on our spending and our obligations. But we also have to be wary of the fact that we have a $32 trillion deficit with a $20 trillion economy. That ratio is very bad. So we need to get our spending under control and these deficits under control. I encourage and expect our Republican leadership to work with the Democrat leadership, to work with Joe Biden in finding some middle ground here so we can see progress. Neither side should expect to get 100% here. But we've got to sit down and have a handshake deal. But I'm discouraged by the fact that the president right now is refusing to negotiate. And that's not a good way to start.
CHANG: Well, that's what I want to ask you about, because House Speaker Kevin McCarthy, I mean, he's proposing that a spending cap be put in place in exchange for raising the debt ceiling. But as you point out, the White House is rejecting any negotiations around raising the limit. So do you personally support linking a vote to raise the debt limit to a spending cut deal?
BACON: I do, but I don't think - some of the proposals on our side are proposals and they're not going to, you know, you've got to find a middle ground with the other side of the aisle here. You can't demand perfection as viewed by the Republican side. Some folks are doing that right now. But I also don't think that it's right for the president to reject any negotiations. I mean, this is how a bicameral separation of powers works. And the president has to meet us partway. So I encourage both sides to sit down. And - but our voters on the Republican side were wanting Republicans to stop this reckless spending. So we got to have some change in direction that we can see to vote on this.
CHANG: Well, let me ask you as to the shape of these negotiations. Some of your Republican colleagues are pushing for changes to entitlement programs like Social Security and Medicare and Medicaid because they are the main drivers of the debt. But these programs have traditionally been the so-called third rail in Washington. You just don't touch them, right? Do you think that has changed? Do you think these programs should be considered for cuts to reduce the deficit?
BACON: Well, for the debt ceiling, I think we should be focused on discretionary spending right now, because what you're getting to, you're very accurate, 75% of our spending right now is the mandatory spending side versus discretionary. But I think it's going to take a lot of work, Republicans and Democrats working together to come up with a bipartisan way forward on Social Security and Medicare. You cannot do a Republican-only plan on Social Security and Medicare. You can't do a Democrat-only plan on these. It's going to have to be both sides working together to figure out how to shore up Social Security, which will go insolvent by 2035 if we do nothing. And Medicare, we're looking at in about four years will be insolvent if we do nothing. That's unacceptable.
CHANG: OK, but then what do you do? Could you clarify what you would do to shore up Social Security and/or Medicare. I mean, some Democrats are saying any proposals to cut those programs are reckless. How does your party convince voters that there is actual merit in keeping this idea on the table? Tell me.
BACON: Well, I don't think we keep this idea at the table for the debt limit or the debt ceiling. I think we focus on discretionary spending, maybe keeping spending within inflation as an agreement. That's what I would envision for this debt ceiling. But long term, the Republicans and Democrats, we should form a committee. Senator Manchin proposes, by the way, I have felt this way for over a year, has encouraged Leader McCarthy to consider this, to put a full-time committee together with Republicans and Democrats. Both sides get a little bit of what they want and they have to give a little bit to save Social Security. It's going to take the two sides giving and taking to save both these programs.
CHANG: I'm listening to the tone you're taking. It's clear that for now, you do believe in the importance of bipartisanship. Are you worried that Speaker McCarthy has just simply promised too much to members of your party who ultimately don't even want to work with Democrats?
BACON: I was concerned about it two or three weeks ago. You may realize I was one of the more vocal people criticizing the 20 for their demands. But, you know, we are where we're at. I think if we - if Republicans - if Kevin McCarthy works with Joe Biden or they both give and take a little bit and they meet in the middle, you'll have - the majority of the Republicans will support that way forward. And I think you'll get the majority of the Democrats as well. And that's the key here. It can't just be one party dictating to the other party because that doesn't work.
CHANG: Right. And there is, of course, the political math here, the fact that Republicans have only a four-seat majority in the House, the fact that the Senate and White House are in the hands of Democrats. So, you know, if Republicans cannot get everything that they want, tell us - what is a reasonable expectation for your party as to how this debt limit fight resolves?
BACON: Well, this is my view. I don't know if I reflect the 222 other members totally on this, but I think we should keep spending below inflation. And if we did that, that's a win, I believe, in the debt ceiling debate. And that would be what I would advocate for the Republican Party.
CHANG: Well, as you're watching this fight unfold, I mean, this is the first big fight for this new Congress. How much hope do you have that this could be a Congress that's capable of coming together to solve big problems?
BACON: Well, I look back to the days of Bill Clinton. We had Newt Gingrich as the speaker, Republican, Democrat president. And we actually balanced the budget. So divided government can work, but you have to do the hard work of sitting down. And you can't demand 100% for your one party. Both sides got to meet in the middle and give and take. It worked under Bill Clinton and Newt Gingrich. I think - I hope we can do that again.
CHANG: That is Republican Congressman Don Bacon of Nebraska. Thank you very much.
BACON: Thank you. Transcript provided by NPR, Copyright NPR.
