Kelly Evans: When will markets force Washington's hand?

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This is a very, very strange moment. For the first time in decades, markets are genuinely nervous about the fiscal situation in Washington. And yet politicians seem far less concerned about it than during the last big government shutdown fight in 2013. The yield on U.S. Treasuries, especially longer-term ones, keeps on rising. The benchmark 10-year Treasury yield hit 4.56% yesterday,…

--a show about nothing."Some days it is about out-of-control spending, some days it's border security, other days it's the war in Ukraine or Speaker McCarthy, Hunter Biden, or Jack Smith," he observes."Groups like the Freedom Caucus are not monolithic in their policy demands or political needs."

This is so vastly different from 2013, when the"Tea Party" rose to power precisely to rein in government spending . The news coverage back then was filled with dollar figures that were being tussled over; $1.2 trillion in cuts over 10 years! Tea Party demands CR cut spending below 2013 levels! GOP moderates push back on spending cuts!over whether the stopgap bill should keep spending at $967 billion or $988 billion.

This time around, the only dollar figures I can even find are buried in news stories, or not mentioned at all. Blocker says the House Freedom Caucus wants to reduce spending by $120 billion more than the caps Speaker McCarthy previously agreed to with President Biden to raise the debt ceiling. Those caps--effective for two years--would effectively keep just military and other discretionary spending flat. Butgiven that the Freedom Caucus labeled its message"Point being, none of this sounds like a major initiative to change the fiscal status quo.

 

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