The ongoing banking crisis has reportedly only emboldened House Republicans to force a debt default crisis and hold the economy hostage until they get deep spending cuts punishing working families and seniors. “This is the best time to do it,” House Budget Committee Chair Jodey Arrington (R-TX) told Punchbowl News among several other Republicans who baselessly blamed the nation’s debt for recent bank collapses. To date, not one Republican in Congress has taken responsibility for their 2018 rollback of Dodd-Frank banking safeguards that experts credit with the recent collapse of mid-sized banks that took risks beyond their means. A manufactured Republican debt default would only make matters worse, likely exacerbating the conditions that led to the rash of recent bank failures including SVB and Signature Bank.

The report comes as House Freedom Caucus members and Republican US Senators laid out the MAGA budget priorities today that call for extreme sacrifice from average Americans and seniors while asking nothing of their wealthy donors and major corporations. With a slim 5-seat Republican House majority, the House Freedom Caucus has more than enough power to manufacture a default crisis that would have catastrophic consequences for Main Street and Wall Street alike. Among the non-starter MAGA economic demands: severely cutting Medicaid that many seniors depend on for long-term nursing home care; shipping American clean energy jobs overseas; rolling back the Biden administration’s popular student loan debt forgiveness plan; and gutting resources in the Inflation Reduction Act for holding wealthy tax cheats accountable, which would only add $114.4 billion to the deficit. 

Republicans in Congress recklessly gutted safeguards that could have prevented the worsening banking crisis. Yet rather than take responsibility, many of the same Republicans cynically want to use the mess they helped create as an excuse to force a default crisis at the expense of American workers and seniors. MAGA extremists in Congress demand cuts that will kick seniors out of nursing homes, offshore good paying jobs, and keep students saddled with debt --- all while they insist on preserving or even expanding wasteful tax breaks for billionaires and greedy corporations.”

Liz Zelnick, Accountable.US’ Director of Economic Security and Corporate Power.
back to top