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The Speaker of the House does not speak to the Secretary of the Treasury on a Saturday night, then sends him a letter. then bring out a press release, unless it is urgent.
But that's what happened Saturday night.
This is Washington's second favorite semi-annual acrobatic scheme: a battle for increasing the debt ceiling. Washington prefer exploit is a battle over government funding. The latter will come in less than two months. But the first is here now – a little earlier than everyone thought.
House Speaker Nancy Pelosi (D-CA) and Secretary of the Treasury Steve Mnuchin recently became friends on the phone. They burned more lines than teenage girls singing "Telephone Hour" in Bye Bye Birdie.
Pelosi seems to prefer working with Mnuchin on this issue – and doing it over the phone.
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Mick Mulvaney, Acting White House chief of staff, has little use for the Speaker of the House. Multiple Congressional sources told Fox that Mulvaney had angered Democrats at the latest round of bicameral and bipartite meetings on Capitol Hill's debt ceiling. Three weeks ago, Pelosi, obviously agitated, told the press that she was refusing to "waste time" with Mulvaney's remarks during the session. She also said that Mulvaney "has no credibility" on the debt ceiling "in any way".
That said, Mulvaney seems to be the head of the administration most in tune with President Trump's identity. Thus, lawmakers ignore Mulvaney – and Mr. Trump's impulses – at their peril.
Still, Pelosi apparently prefers to use the phone to engage Mnuchin. And maybe it's the same for Mnuchin regarding the Pelosi speech. For a reason, Ambrose Bierce described the phone as "a devil's invention that removes some of the benefits of letting an unpleasant keep its distance."
With regard to communications between Pelosi and Mnuchin:
On Wednesday night, the duo spoke of the urgent need to raise the debt ceiling.
Pelosi and Mnuchin spoke twice last Thursday. They spoke at noon on Friday. Then the duo discussed for 12 minutes Saturday night.
MNUCHIN WARNING PELOSI DEBT CEILING COULD BE REACHED IN SEPTEMBER
Mnuchin sent a letter to Pelosi stressing the need to raise the debt ceiling over the next two weeks. The President sent her own letter to the Secretary of the Treasury on Saturday evening.
The highest political leaders in the country do not often discuss this and do not communicate with each other – especially on Saturday nights – unless there is a problem.
The problem "One vote to increase the debt limit is one of the most expensive votes that lawmakers can vote on." The problem does not anyone want to vote to allow more debt. But the problem is that Congress must quickly raise the debt threshold or risk a downgrade of the country's credit rating, shake the stock market or send a shock to the bond market.
The problem Mnuchin begs Congress to immediately raise the debt ceiling – before lawmakers abandon Washington for most of the month of August and the traditional summer break. This is because few people in Washington paid close attention to this issue a few days ago. It was at this point that Mnuchin suggested that the government could "run out of money in early September, before the resumption of Congress". Government reserves will soon increase to about $ 250 billion. The accelerated schedule is partly due to the decrease in income, attributable to the new tax law.
One sign that government coffers are dry the other day is the return on short-term treasury bill yields. The yield on treasury bills maturing in mid-September is now higher than those that matured in mid-August. People do not invest in short-term government securities either, which is another sign of potential problems.
If Congress and the Trump Administration do not act quickly, federal cash reserves could decline and the government could fight to meet its liquidity needs.
By sending a letter on a Saturday night, Pelosi is trying to sound the alarm by insisting lawmakers on the need to quickly raise the debt ceiling.
Washington has long heard of the need to raise the debt ceiling. Several months ago, parties were discussing the conclusion of a two-year agreement on spending caps and its mix with the debt ceiling. Last May, Senate Majority Leader Mitch McConnell (R-KY) had hinted that they were so close to each other that an agreement could not be reached. last only a few hours.
But then the discussions melted.
In his letter to Mnuchin on Saturday evening, Pelosi insisted that the parties reach an agreement on "spending priorities". This is a reference to the stalled efforts to lift the mandatory spending ceilings imposed by Congress in a 2011 package to raise the debt ceiling. In Washington, ceilings are commonly known as "sequestration". Sequestration is particularly hard on the defense because the Pentagon commands the largest amount of money paid by Congress each year. President Trump wants more for the defense. Democrats are ready to bend a little. But that's why Pelosi argues for "parity". In other words, Pelosi calls for a parallel increase in funding for all non-defense programs.
Just days ago, a senior congressional official told Fox that it seemed that the parties might have to accept a short-term extension of the debt ceiling. Technically, the issue of capping spending does not need to be resolved until mid-January. But Pelosi combines these problems now.
In the meantime, many congressional Republicans do not want to simply raise the debt limit unless it is attached to something. Even if not addressing the problem of the debt ceiling threatens the market or the ability of the federal government to borrow. This is why some members of the GOP have hoped for an imminent cap agreement. The inability to keep raising the debt ceiling to a cap agreement could be a problem for some Senate Republicans.
This sparked discussions on the integration of the increase in the debt ceiling into the bill to fund health care coverage for the first responders who were ill on September 11th. The House approved the 402-12 plan on Friday. McConnell has promised to tackle the problem in the coming weeks. Leaving the Capitol on Friday afternoon, Jon Stewart, the 9/11 first responder's lawyer, specifically ruled against the Scottish Scotch that had registered the 9/11 bill over another measure, or vice versa. But when it comes to legislating, you do not get style points.
And so, everyone in Washington has a problem without a lot of time to solve it. It is possible for Congress to suspend part of the August holidays if something does not happen quickly.
Expect more phone calls between Pelosi and Mnuchin.
Raising the debt ceiling is a monumental task for Congress. And while policy makers can negotiate this over the phone, raising the debt ceiling is so important that you can not just phone it.
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