McConnell: ‘Zero Chance’ the Debt Ceiling Will Be Breached
At an event in Kentucky to discuss tax reform, Senate Majority Leader Mitch McConnell and Treasury Secretary Steven Mnuchin insisted Monday that Congress will raise the debt ceiling by late next month, in time for the U.S. to avoid a default that could roil the global economy and markets.
Related: The Debt Ceiling — What It Is and Why We Should Care
The key quotes, per Roll Call:
McConnell: "There is zero chance — no chance — we won't raise the debt ceiling. No chance. America's not going to default. And we'll get the job done in conjunction with the secretary of the Treasury."
Mnuchin: “We’re going to get the debt ceiling passed. I think that everybody understands this is not a Republican issue, this is not a Democrat issue. We need to be able to pay our debts. This is about having a clean debt ceiling so that we can maintain the best credit, the reserve currency, and be focused on what we should be focusing on — so many other really important issues for the economy.”
Related: Here’s a Solution for the Annual Debt Ceiling Crisis — Get Rid of It
Mnuchin reiterated his “strong preference” for a “clean” increase to the debt limit — one without other policy proposals or spending cuts attached to it — but some House conservatives continue to press for such cuts.
Bonus McConnell quote on what tax breaks might be eliminated in tax reform: “I think there are only two things that the American people think are actually in the Constitution: The charitable deduction and the home mortgage interest deduction. So, if you’re worried about those two, you can breathe easy. For all the rest of you, there’s no point in doing tax reform unless we look at all of these preferences, and carried interest would be among them.”
Tax Refunds Rebound
Smaller refunds in the first few weeks of the current tax season were shaping up to be a political problem for Republicans, but new data from the IRS shows that the value of refund checks has snapped back and is now running 1.3 percent higher than last year. The average refund through February 23 last year was $3,103, while the average refund through February 22 of 2019 was $3,143 – a difference of $40. The chart below from J.P. Morgan shows how refunds performed over the last 3 years.
Number of the Day: $22 Trillion
The total national debt surpassed $22 trillion on Monday. Total public debt outstanding reached $22,012,840,891,685.32, to be exact. That figure is up by more than $1.3 trillion over the past 12 months and by more than $2 trillion since President Trump took office.
Chart of the Week: The Soaring Cost of Insulin
The cost of insulin used to treat Type 1 diabetes nearly doubled between 2012 and 2016, according to an analysis released this week by the Health Care Cost Institute. Researchers found that the average point-of-sale price increased “from $7.80 a day in 2012 to $15 a day in 2016 for someone using an average amount of insulin (60 units per day).” Annual spending per person on insulin rose from $2,864 to $5,705 over the five-year period. And by 2016, insulin costs accounted for nearly a third of all heath care spending for those with Type 1 diabetes (see the chart below), which rose from $12,467 in 2012 to $18,494.
Chart of the Day: Shutdown Hits Like a Hurricane
The partial government shutdown has hit the economy like a hurricane – and not just metaphorically. Analysts at the Committee for a Responsible Federal Budget said Tuesday that the shutdown has now cost the economy about $26 billion, close to the average cost of $27 billion per hurricane calculated by the Congressional Budget Office for storms striking the U.S. between 2000 and 2015. From an economic point of view, it’s basically “a self-imposed natural disaster,” CRFB said.
Chart of the Week: Lowering Medicare Drug Prices
The U.S. could save billions of dollars a year if Medicare were empowered to negotiate drug prices directly with pharmaceutical companies, according to a paper published by JAMA Internal Medicine earlier this week. Researchers compared the prices of the top 50 oral drugs in Medicare Part D to the prices for the same drugs at the Department of Veterans Affairs, which negotiates its own prices and uses a national formulary. They found that Medicare’s total spending was much higher than it would have been with VA pricing.
In 2016, for example, Medicare Part D spent $32.5 billion on the top 50 drugs but would have spent $18 billion if VA prices were in effect – or roughly 45 percent less. And the savings would likely be larger still, Axios’s Bob Herman said, since the study did not consider high-cost injectable drugs such as insulin.
