The official Republican Party position “doesn’t matter to me,” said Sen. Chris Murphy (D-Conn.). “We are not negotiating on the debt ceiling.”
Republican leaders retort they lack the voice to pass clean debt ceiling extension without cutting expenses. The Senate government recently made a conference position to associate spending cuts with increases in the debt ceiling.
As such, Senate Minority Whip John Thune said it was “unlikely” that he could produce 10 votes for the debt ceiling without cutting spending. Republicans have said that while their new caucus rule is soft, GOP senators intend to take a hard line on debt.
“I don’t think Republicans will vote for a clean debt ceiling. It would be the worst of all worlds, ”said Senator John Cornyn (R-Texas), a close ally of Senate Minority Leader Mitch McConnell.
Democrats also have the option of completely ignoring Republicans on the debt ceiling, even if that would force them to consider a budget resolution, paving the way for using the reconciliation process so that they only need a simple majority – and full party unity.. They could also try to include it in a spending bill this fall or an infrastructure bill this summer, if the time is right.
Regardless of how Democrats do it, they know there is no wiggle room.
“It is always a legislative act that defies death. And it’s a shame because we tie knots regularly by doing what we know we must do, ”said Senate Majority Whip Dick Durbin.
Durbin and several other Democrats said their preference was to pass a raise with Republican support. The last time a Democratic majority did this, the vote went on for hours as Republicans worked to produce the votes.
Sen. Ted Cruz (R-Texas), who obfuscated this previous bill to ensure Democrats had to have Republican votes to raise the debt ceiling, said he would resume his earlier tactics: “We should use all the tools at our disposal to stop bankrupting our children and grandchildren. “
“In just four months, Joe Biden proposed over $ 6 trillion in new spending,” the Texas Republican said. “It is extremely irresponsible and threatens the financial security of our nation.”
When asked this week if Democrats would use reconciliation to manage the debt ceiling and exclude the GOP, Senate Majority Leader Chuck Schumer slammed Republicans for playing politics with security the country’s financial system. But at the end of the day, he said, “We have to do something the right way.”
Cruz said Republicans should use the debt ceiling as a crowbar to demand budget reforms, pointing to the debt ceiling deadlock about a decade ago that ushered in an era of tight funding limits by through the law on budgetary control.
“Historically, the debt ceiling has proven to be the most effective lever to implement meaningful spending reforms and structural reforms,” he said.
But when asked if Republicans would be adamant in their demands for reform, Sen. Rand Paul (R-Ky.), A devout fiscal hawk, said, “I doubt it. I go. “
Over the past three decades, Congress has acted 25 times to prevent the nation from exceeding its borrowing limit and defaulting on its loans – a breaking point that would likely lower the government’s credit rating, raise costs for US borrowers and would tip the stock market into a spin. During that time, the debt ceiling rose from around $ 4 trillion in the early 1990s to over $ 28 trillion today.
Congressional leaders struck a deal in 2019 that suspended the debt ceiling until July 31. At this point, the Treasury Department could take so-called extraordinary measures to continue paying government bills on time while lawmakers craft another deal.
But the Treasury also warned last week that such measures could expire sooner than expected due to pandemic uncertainty over spending and income.
In a statement, Assistant Under Secretary for Federal Finance Brian Smith said: “It is very difficult to predict how long extraordinary measures could last.”
“The Treasury is evaluating a range of potential scenarios, including some in which extraordinary measures could be exhausted much faster than in previous debt limit episodes,” he said.
Senator John Neely Kennedy (R-La.) Said it was still not clear whether enough Republican senators would be willing to hold the line this year by risking government default in demanding changes intended to stop the trend expenses in red ink. And if they do, Democrats say they won’t engage with them.
“My preference on the debt ceiling is that we spend as little time and as little energy as possible,” said Senator Elizabeth Warren (D-Mass.).
When Republicans challenged Obama in 2011 over the debt limit, the debate alone spooked financial markets and prompted the S&P to lower America’s credit rating for the first time in history.
“The last time the Republicans took the debt ceiling hostage, they nearly crushed the global economy,” recalls Senator Ron Wyden (D-Ore.), Chairman of the Senate Finance Committee. “This is a page from the Obama-era economic sabotage handbook, and I’m not going to let Republicans play games with the economy for their political gain. “
And for the first time in 10 years, something is missing from the debate: a distinct threat of dreaded forcible confinement. Both sides have already been drawn into tax negotiations like this one by their desire to agree on spending limits to avoid deep automatic cuts to military and non-defense programs. But this budgetary specter was dispelled two years ago.
Now, what prompts Republicans to vote for an increase in the debt ceiling – in addition to preventing an immediate tax calamity – is the possibility of changing congressional spending practices, according to Sen. Lindsey Graham (RS. C.), the highest member of his party. to the Senate Budget Committee. This could include forcing lawmakers to forgo paychecks until they pass a budget each year, he said.
“We’re not going to play chicken here,” Graham said. “But I don’t think that’s too much to ask, to say: Can we do structural reforms? … I’m not asking for Medicare to be repaired. “
Although the question freezes, a number of senators have said they have not considered it. Several senior senators said they were unsure how Congress was going to get around the problem.
“Hell, I didn’t even think about it,” said Sen. Joe Manchin (DW.Va.), who has been involved in infrastructure negotiations with the White House and met with Biden earlier this week.
Still, it’s not like debt isn’t on his mind: he asked a reporter and staff member about the level of debt and revealed he sent her the Federal Debt issue. every morning.
Marianne LeVine contributed to this report.