A debt default would be like a government shutdown on steroids.
Democrats in the House of Representatives passed a bill Tuesday evening that would suspend the federal government’s borrowing limit, which would avoid a potentially catastrophic debt default.
But Senate Republicans have insisted they will not vote for a debt limit suspension ― meaning the bill will stall in that chamber with no clear prospects for its passage or an alternate solution before the federal government exhausts its ability to borrow money next month.
What’s odd about this standoff is that Republicans and Democrats agree that Congress has to address the debt limit, but Republicans are refusing to vote for what they themselves consider the right outcome.
“We don’t want to have a national default. That would be catastrophic,” Sen. Mitt Romney (R-Utah) told reporters on Tuesday. “Democrats can solve this all by themselves. They have the votes to do it. Do it.”
Failing to deal with the debt limit could roil financial markets and even disrupt basic government operations.
“Nearly 50 million seniors could stop receiving Social Security checks for a time,” Treasury Secretary Janet Yellen wrote in an opinion piece this week. “Troops could go unpaid. Millions of families who rely on the monthly child tax credit could see delays. America, in short, would default on its obligations.”
At the moment, neither side is showing signs of backing down. What makes this clash even more dangerous is that Congress must also pass a bill to avert a government shutdown by Sep. 30, a scenario that could deal a double blow to the economy.
Congress has traditionally raised the statutory debt ceiling on a bipartisan basis, with votes from members of both parties. Republicans voted to suspend the limit three times during the Trump administration, adding trillions of dollars to the national debt. In 2017, when Republicans controlled the White House and Congress, Democrats joined them in voting to suspend the country’s borrowing authority even though the GOP was pushing a $1.5 trillion tax cut.
During the 2011 debt ceiling crisis, which resulted in the first-ever downgrade of U.S. debt holdings, Republicans demanded Democrats agree to enact budget cuts in exchange for an increase in the debt limit.
This time around, Republicans aren’t asking for anything; they’re simply refusing to vote for it.
“For Republicans to suddenly throw their hands in the air and abscond from their responsibility to pay debt that they proudly supported is nothing short of a dine-and-dash of historic proportions,” Senate Majority Leader Chuck Schumer (D-N.Y.) said Tuesday. “Republicans racked trillions of dollars of debt under President Trump and are demanding American families foot the bill.”
Republicans argue that since Democrats passed a partisan pandemic relief bill earlier this year and are planning to pass another partisan spending bill this fall, they should handle the debt limit themselves by attaching a debt limit increase to the forthcoming $3.5 trillion measure. But Democrats, who are currently beset by divisions over the bill, may not finish work on it before the Treasury Department starts defaulting on debts sometime in October.
The argument that Democrats are solely responsible for the national debt ignores the fact that annual budget deficits reflect years of policy choices, including ones that resulted from bipartisan or purely Republican votes. The Joint Committee on Taxation, for instance, projected in 2017 that the Republican tax bill passed that year would add $220 billion to the federal budget deficit this year.
On Tuesday, several Senate Republicans said simply that Democrats are in charge now, so they have to deal with it.
“It’s a partisan vote because they’re in the majority,” Sen. Chuck Grassley (R-Iowa) told HuffPost.
“They need to do it on their own,” added Sen. John Cornyn (R-Texas).
“The fact is, [my] Democratic colleagues have gone on a spending binge that is without precedent, at least since World War II, maybe ever,” Sen. Pat Toomey (R-Pa.) said. “And if they want to spend that much, they can raise the debt limit.”
Sen. John Thune (R-S.D.) told HuffPost it doesn’t matter that the national debt has been piled up in a bipartisan way since Democrats are now working on major legislation with no Republican input.
“The bipartisan nature of things that have been done in the past is clearly different than what they’re doing right now,” Thune said.
Republicans could allow Democrats to raise the debt ceiling with a simple majority vote ― if they opted not to filibuster the bill, which sets up a 60-vote threshold for passage. But several GOP senators, including Sen. Ted Cruz (Texas), have already said they won’t allow that to happen.POST YOUR OPINION HUFFPOST.COM https://www.huffpost.com/entry/republicans-congress-debt-ceiling_n_614a19bee4b0e5dd4b2cbc3c