House Democrats Consider Killing The Debt Limit
Arthur Delaney
Tue, 19 October 2021, 12:00 am
Democrats in the House of Representatives will consider getting rid of the arbitrary limit on how much money the U.S. government can borrow to fund operations.
House Majority Leader Steny Hoyer (D-Md.) said in a letter to fellow lawmakers over the weekend that “the House will explore options to remove the threat that the debt limit poses over the long term, now that Republicans have demonstrated a willingness to weaponize it for partisan purposes.”
Democrats have resisted abolishing the debt limit, insisting instead that Republicans join them in voting to temporarily suspend the borrowing ceiling or to increase it by an incremental amount, necessitating more voting and potential partisan clashes down the line.
But Senate Republicans refused to support a debt limit increase earlier this month until the Treasury Department nearly ran out of cash, an event economists say could spark a financial crisis and recession.
Senate Majority Leader Mitch McConnell (R-Ky.) said he agreed to vote for the debt limit increase because Democrats had threatened to change the Senate’s filibuster rules. Afterward, McConnell said in a letter to President Joe Biden that Senate Republicans wouldn’t help with the next debt limit vote in December because Senate Majority Leader Chuck Schumer (D-N.Y.) had hurt their feelings with a mean speech.
Republicans aren’t seeking policy concessions in return for supporting a debt ceiling extension. They’re not taking a principled stand, either. By refusing to support an extension, they’re refusing to let the federal government pay bills that they racked up themselves. It’s not an exaggeration to say the Republican position on the debt ceiling is motivated by pure political spite.
McConnell has said that since Democrats are planning to pass a big social policy bill without any Republican votes, then Democrats should go ahead and include a debt limit increase. Democrats have resisted that suggestion, possibly because the special “budget reconciliation” process they’re using for the social policy measure might require them to increase the debt limit by a specific dollar amount instead of simply “suspending” it for a period of time.
But there’s another option: Democrats could use budget reconciliation to make the entire phony debt ritual go away forever. They’ve just lacked the collective will to do so. When HuffPost asked Schumer earlier this month about abolishing the limit or raising it to such a high level as to make it effectively obsolete, he responded by saying Republicans simply had to come around.
Other Democrats have told HuffPost that they like the idea of getting rid of the debt limit, but didn’t think it would be smart to do so in the middle of a standoff imperiling the full faith and credit of the United States. And others have said they don’t think enough Democrats would vote for such a major change.
Hoyer’s letter is a signal that Democrats are increasingly open to getting rid of the debt limit ― and soon. Hoyer said the House “may consider legislation as early as this month to do so.”
One option, per a bill by Reps. Brendan Boyle (D-Pa.) and John Yarmuth (D-Ky.), would give the Treasury Department the power to deal with the debt limit by itself, and Congress the ability to veto Treasury’s action if lawmakers feel strongly about it.
House Speaker Nancy Pelosi (D-Calif.) said last week she’s still hoping for a bipartisan debt limit vote, but seemingly endorsed the Boyle-Yarmuth idea. “I do think it has merit,” she said.
