Senate braces for nasty debt ceiling battle

Republicans dig federal debt limit, warning Democrats that it will be up to them to avoid default because President BidenJoe Biden Biden Says Wages Will Need To Raise To Fix Hiring Problems Caitlyn Jenner Pledges To Back Trump If He Makes Another White House Offer Biden: Republicans Who Say Democrats Want To Fund Police Lies MORE grows billions more in spending.

GOP Senators Take Strong Position As Democrats Chart Path For Their $ 3.5 trillion Spending Measure, Which The Party Plans To Pass With Budget Reconciliation Rules That Will Prevent The GOP From Blocking It With Obstruction .

Given these plans, GOP senators say they will not lift a finger to help Democrats raise the debt ceiling.

“I don’t know why there are a lot of incentives right now given what Democrats are doing, trying to flout the minority in the Senate, to help them,” Sen said. John ThuneJohn Randolph ThuneGOP negotiators say they will vote to start infrastructure debate next week McConnell warns GOP will not vote to raise debt ceiling Schumer urges GOP to move infrastructure debate forward MORE (SD), the No. 2 Republicans in the Senate.

Thune added that if Democrats are going to use a stand-alone approach to push through a broad spending program, which should include other priorities like immigration reform, then Republicans believe “the debt limit may be exceeded. and they can own anything. “

Leader of the minority in the Senate Mitch mcconnellAddison (Mitch) Mitchell McConnellOn the money: Biparty infrastructure group says it’s still on track after Senate setback | House Democrats want comment on bipartisan plan | McConnell Warns GOP Won’t Vote To Raise Balance / Sustainability Debt Ceiling – Brought To You By NextEra Energy – West Coast Wildfires Trigger East Coast Air Quality Alerts GOP Shuts Down debate on infrastructure as negotiators move closer to a PLUS deal (R-Ky.) Presented GOP tactics to Punchbowl News, in remarks confirmed by his office.

“I can’t imagine there will be a single Republican vote to raise the debt ceiling after what we’ve been through,” he said.

The government will hit its spending limit on July 31, although the Treasury Department may mix funds for an additional period to prevent the United States from breaking the cap. In fact, it would cause serious disruption to the markets and the economy, as the US government would be unable to meet the demands of its creditors and pay its bills.

The limit on the amount of debt the federal government can owe has been suspended for almost two years thanks to a bipartisan agreement reached under the former president Donald trumpDonald TrumpCaitlyn Jenner vows to back Trump if he makes another White House offer Biden says he doesn’t want voting rights ‘wrapped up’ in filibuster debate The Club for Growth’s attacks Cheney in commercial, compares her to Clinton MORE. The Congressional Budget Office estimated on Wednesday that the Treasury would most likely be cash-strapped in October or November, although that is only an estimate.

Experts have said the coronavirus pandemic makes it more difficult to accurately estimate when the United States will default on its obligations in the absence of any action.

“There are so many expenses that come out in a relatively short period of time, and because there is a lot of uncertainty about when those expenses will come out, it’s even harder than usual to predict which habits spending in August, September, October, etc. are going to be the same, ”said Shai Akabas, director of economic policy at the Bipartisan Policy Center, a non-partisan think tank.

Republican senators plan to use the specter of the crisis to obtain major tax concessions, in a throwback to the Obama years.

His. Lindsey grahamLindsey Olin Graham Biparty Group Says Still On Track After Senate Setback How Sen. Graham Can Help Solve Workforce Shortage With Common Sense Immigration Reform McConnell warns the GOP will not vote to raise debt ceiling PLUS (RS.C.), the top Republican on the budget committee, is expected to present a proposal next week, accusing Congress of “spending like drunken sailors.”

“We have to do structural reforms later. … About half the time the debt ceiling has been raised has something to do with it and I think it’s time to put some ideas on the table, ”he said.

The effort comes after a GOP Congress approved a massive tax cut bill during the Trump years that worsened the deficit. It also follows a string of big spending bills signed by Trump and Biden that aimed to help the economy survive the pandemic.

Democrats would need at least 10 GOP votes to defeat a filibuster on a stand-alone debt limit increase and several progressives have ruled out giving in to Republicans’ spending cuts demands. Several senior Senate Democrats, including the majority leader Charles SchumerChuck Schumer’s vote today on bipartisan infrastructure bill is dangerously premature Democrats present a vision for the Civilian Climate Corps. (DN.Y.) – accused McConnell of holding the US economy hostage.

“The leader’s statements on the debt ceiling are shameless, cynical and utterly political,” Schumer said on Capitol Hill Wednesday.

“This debt is Trump’s debt. It’s the COVID debt. Democrats have joined three times during the Trump administration to do the responsible thing, ”Schumer added. “And the bottom line is that Leader McConnell shouldn’t be playing political games with the full faith and credit of the United States.”

Republicans have suggested Democrats add an increase in the debt limit to the budget reconciliation process.

This would make it easier for Democrats to raise the cap, but would also protect GOP senators from a vote necessitated by spending decisions from both parties.

Chairman of the Senate Budget Committee Bernie sandersBernie SandersSchumer leaves door open for second vote on bipartisan infrastructure deal GOP blocks infrastructure debate as negotiators move closer to Sanders deal to campaign for Turner in Ohio MORE (I-Vt.) Said Democrats “are looking at various approaches” while criticizing Republicans’ comments on the debt limit.

“It goes without saying, I think the world expects the strongest economy in the world to pay its debts,” he said.

It’s unclear whether Democrats could pass such a bill before the debt ceiling deadline.

Democrats are expected to vote on a budget resolution, which gives the party line bill the green light, before leaving for a recess in August. But once they get back, they’ll likely negotiate a separate deal for weeks to fund the government.

Passing a reconciling bill is already fraught with challenges: Democrats need full unity in the Senate and close unity in the House, a delicate balance that will take time to negotiate. And the proposals it contains need the green light from the parliamentarian of the Senate, who makes decisions on what is admissible and not, and should not start making decisions on what can be included in the spending plan before. that Democrats passed their budget resolution next month. .

Graham predicted Democrats would eventually try to find another way to raise or suspend the debt ceiling, arguing that making it part of their $ 3.5 trillion plan would be a political giveaway for Republicans.

“I doubt they’ll accept them… I think it would be a great addition there,” said Graham, when asked about McConnell’s suggestion that Democrats do it through reconciliation. “You raise taxes, you raise government, you raise debt on your own. ”

Trillions of dollars in treasury bills held by foreign governments and investors are underpinned by confidence in the federal government’s ability to pay its bills. A default on the national debt could shatter that confidence and trigger a catastrophic financial crisis.

“At this point, we would be purely defensive, trying to find the best way to save a potentially catastrophic economic scenario,” Akabas said.

In testimony to a Senate panel last month, Yellen warned that a federal default “would have absolutely catastrophic economic consequences” and cause “unthinkable” economic damage.

It’s not uncommon for Republicans to take a tough stance on the debt limit when Democrats are in power. Specifically, S&P downgraded the United States’ credit rating from AAA, the highest level, to AA + during the Obama administration in 2011, shortly after a few debt ceiling deadlock was resolved. just days before the United States defaults.

But the debt ceiling has been suspended several times under the Trump administration without too much difficulty.

Democrats accused Republicans of a double standard after 23 GOP senators voted for a deal that included a debt ceiling suspension in 2019.

“It’s not business as usual. When Donald Trump was President of the United States, we didn’t say we were going to have a one, two, three political agenda before we paid our bills, ”Wyden said.

The White House has said Congress should approach the debt ceiling on a bipartisan basis, as it did when Trump was president.

“We expect Congress to act in a timely manner to raise or suspend the debt ceiling, as it has done three times on a broad, bipartisan basis during the last administration,” the attaché said. press release from the White House. Jen psakiJen PsakiBiden Laughs at Fox Hosts: They Had ‘Altar Call’ On Vaccines Fox News Is Broadcasting PSA Telling Viewers To ‘Get The Shot’ Psaki Says WH To Release COVID-19 Positive Officials Who Go In contact with Biden, Harris PLUS said Wednesday.

But Thune, when asked about the difference between those votes, argued that the “atmosphere” had deteriorated rapidly since then.

“I mean Democrats are openly talking about getting rid of legislative filibuster,” he said, “the only thing stopping it from happening is they can’t produce the votes on their side”.