Senate Republicans are expected to block a bill Monday that would fund the government and prevent a default on U.S. debt as part of a strategy to saddle Democrats with an increase in the country’s borrowing ceiling ahead of the vote. midterm elections next year.
While both sides agree that the $28.4 trillion limit on loans must be raised before the federal government can no longer pay its loans or stop paying military personnel or Social Security benefits, they are stuck on who should act. .
The result is increasingly dire warnings of financial catastrophes and recessions that could cost up to six million jobs.
The first deadline in a high-stakes week, with President Biden’s massive spending plans at stake, comes Monday night.
Republicans have made it clear that they will not support a bill through December 3 to fund the US government and suspend the country’s borrowing limit until the end of next year.
“It couldn’t be easier,” Republican Senate President Mitch McConnell said last week.
“If they want to tax, borrow and spend historic sums of money without our input, they will have to raise the debt limit without our help.
‘This is the reality. I’ve been saying that very clearly since July.’
Senate Leader Mitch McConnell has said Republicans will not support a bill raising the US debt ceiling in a vote on Monday. “If they want to tax, borrow and spend historic sums of money without our input, they will have to raise the debt limit without our help,” he said recently, despite the looming threat of a shutdown.
Democrats face a pivotal week with a series of votes that could determine Joe Biden’s presidency. Senate Majority Leader Chuck Schumer (r) Is Deep In Negotiations To Send Massive $3.5 Trillion Spending Plan
A new report claims a US federal debt default would be ‘catastrophic’ for the economy as Republicans and Democrats in Congress try to strike a deal this week
Instead, McConnell is urging Democrats to include their raise in their multi-trillion-dollar partisan tax and spending plan — which President Biden and Nancy Pelosi hope to send through Congress with only Democratic votes.
“They can’t put partisan ambitions above basic tasks,” McConnell said.
“The party line writers of this reckless tax and spending wave will be the party line owners of raising the debt limit.”
Democrats are pushing their $3.5 trillion spending package using a legislative process known as reconciliation, which allows them to avoid Republican opposition in the form of the filibuster.
Adding the debt ceiling to the package would highlight the price tag — which Republicans say could reach $4.3 trillion — and distract from popular elements like paid family leave, insiders say.
“The price tag and then the tax hikes that come with it will be a core argument for Republicans next year in the medium term,” said a Senate GOP official.
Jeanne Zaino, a political science professor at Iona College, told DailyMail.com that McConnell had a clear eye on winning back the House and Senate next week, and his moves had made it harder for Democrats to reap the benefits of their spending plan. utilize.
“Whether it’s free education or these birth-to-death issues, they can’t talk about it because they’ve been tracked down by Republicans to focus on this top line number,” she said.
Senator Joni Ernst, a Republican in Iowa, said: Bloomberg News that the vote on the party-line debt limit would crystallize the case that Democrat spending was spiraling out of control.
Republicans line up to link debt ceiling hike to President Biden’s spending plans
Democrats Accuse Republicans of Hypocrisy in Opposing Raise
The US Treasury Department said it will run out of money by October unless Congress raises its debt ceiling. The chart shows how the department predicts it will run out of money from now until October 20, when it owes more than $20 billion to Social Security recipients.
“It will be very effective in Iowa,” she said.
GOP strategist John Feehery said Democrats should raise the debt.
“No Republican is going to extend the debt limit so the Democrats can spend more,” he said. “Politics would be terrible for any Republican doing it.”
Democrats say it is irresponsible of Republicans to develop a partisan strategy in view of the midterm elections when the country is facing so many crises.
“It’s bad for the economy,” said Senator Cory Booker, a New Jersey Democrat. “It is very sad at this time that we are struggling with a pandemic.
During an interview with CNN, he also pointed out that the debt grew by more than $7 trillion under President Trump.
But Republicans shrugged off the criticism, saying Democrats control the White House and Congress and have all the tools they need to raise the ceiling.
“The idea that it would be the Republicans filing a default detracts from credulity,” the aide said.
And Zaino said: Democrats had their own good reason for playing with the ceiling rather than pursuing their own solution.
“They want to argue that Republicans are not playing fair, they are not bipartisan,” she said.
“If it’s Trump, they’re willing to raise the ceiling, if it’s Biden, they’re not.”
The latest forecasts indicate the stakes, suggesting that the Treasury Department could run out of funds by mid-October if lawmakers don’t act quickly.
“New data shows Congress only has weeks to address the debt limit,” Shai Akabas, economic policy director at the Bipartisan Policy Center, said in a statement.
“If they don’t, the US government risks missing or delaying important bills due by mid-October that millions of Americans rely on, from military paychecks and retirement benefits to advanced payments of child tax credits.”
Moody’s Analytics recently predicted that the US default on its debt payments could be a “catastrophic blow” to the economic recovery from COVID-19 and lead to the loss of six million jobs, raising the country’s unemployment rate. rise from 5.4 percent to nine percent.
Moody’s explained, “The original intent of the debt cap was to force lawmakers to remain fiscally disciplined.”
The analysis also said that once the funds ran out, the Treasury Department would not be able to meet 40% of all payments due until mid-November.
“How Treasury would operate in such an environment is unclear,” it said. ‘Priorization and deferral of payment are two options, but there is great uncertainty about their operationalization.’
The debt ceiling is just one of a series of pivotal votes in Congress this week that could determine Biden’s presidency.
House Democrats must vote on a $1 trillion infrastructure bill passed by the Senate last month with significant support from Republicans to fund roads, bridges, airports, schools and other projects.
But progressives say they won’t vote until the bigger $3.5 trillion package is agreed.