House Republicans have finally made their demands for raising the debt ceiling before the government defaults on its loans. It’s not going to be pretty.

In a speech delivered at the New York Stock Exchange, House Speaker Kevin McCarthy outlined the party’s demands.

Contrary to expectations, McCarthy did not tie demands for cuts to Social Security and Medicare to an agreement to raise the debt ceiling. So what do Republicans want to put on the chopping block? Their proposal would undo Biden’s partial student-loan cancelation (which is already tied up in court) as well as the moratorium on collecting student debt. They also want to roll back parts of the Inflation Reduction Act and cut money that is supposed to go to the Internal Revenue Service (IRS) to increase enforcement on the rich. And their plan would make it significantly harder for people to access Medicaid, food stamps, and Temporary Aid for Needy Families (TANF — the main cash welfare program for poor families with children).

In exchange for all that and more, McCarthy is proposing to raise the debt limit for less than a year, at which point he would presumably demand even more cuts.

As ghoulish as these demands are, there isn’t much surprising in them. Making it harder to collect taxes on the rich and making life difficult for the poor and young people on principle is pretty standard Republican fare. What’s notable here (even if not completely new) is the extent to which McCarthy and the House GOP are attempting to push the policies through with the threat of crashing the economy.

With a slim majority in the House and with Democrats in control of the White House and Senate, Republicans hardly have a strong democratic mandate for severe cuts to social spending. That leaves them only with the structural leverage of the debt ceiling, threatening to tank the government’s credit and cause unpredictable economic problems if they don’t get their way.

Joe Biden and Senate Majority Leader Chuck Schumer both called McCarthy’s proposal a nonstarter. They have shown surprising and commendable consistency in refusing to negotiate spending cuts in exchange for raising the debt ceiling. McCarthy also faces the challenge of keeping a very slim and fractious majority in the House united — which perhaps explains leaving Medicare and Social Security off the table for now.

Both sides will probably have to give up something to avoid default. But while McCarthy probably won’t get everything he wants, simply setting the precedent of extracting concessions with the debt default before budget negotiations begin would be a significant win for the forces of austerity. Ideally Democrats will maintain their line on no negotiations, but it’s impossible to predict if they really will when faced with the prospect of the immense economic pain a default would cause under their watch.

Now is a good time to remember that most countries don’t have a statutory debt ceiling and see no reason the United States needs one at all. Several times in the past two decades, Democrats have had the chance to either fully abolish the debt ceiling, or to set it so high as to effectively abolish it. In failing to do so, they allowed McCarthy and the Republicans to get to this point. If nothing else, perhaps the coming showdown will change their minds.