Steven Mnuchin urges Congress to raise debt limit before summer break

The federal government could bump up against its debt ceiling earlier than predicted, and the Trump administration asked Congress on Wednesday to move quickly to raise the borrowing limit before lawmakers go home for their August vacation — throwing another thorny issue on the Republicans’ already-long list.

Treasury Secretary Steven Mnuchin also asked for a “clean” increase, rejecting conservatives’ demands that a raise in debt be accompanied by spending cuts.

Mr. Mnuchin said spending cuts can be discussed another time, but also said a debt-limit increase merely allows the U.S. to pay the bills it’s already racked up — echoing an argument Democrats have made for years.

“I think it is absolutely important that this is passed before the August recess, and as far as I’m concerned, [the] sooner the better,” he told the House Ways and Means Committee as he defended the president’s budget proposal, sent to Congress earlier this week.

Congress and President Obama had suspended the debt limit for all of 2016, allowing the government to borrow as much as it needed to pay the bills. But the limit was reimposed by law in March, and set at $19.8 trillion.

Mr. Mnuchin has been using tools to keep from breaching the limit, but will run out of room later this year, necessitating a new increase.

The Congressional Budget Office in March estimated that deadline would come this fall.

But White House budget director Mick Mulvaney said Wednesday that receipts were coming in slower than expected, lending more urgency to the situation.

Republicans are just emerging from a divisive spending fight that saw GOP leaders cave on their budget-cutting demands, and the debt limit will pose yet another challenge. Republicans are also dealing with deep divisions in their ranks over health care and taxes.

In the past, former Speaker John A. Boehner had to rely on Democrats to provide a good deal of the votes for packages that extended the debt limit deadline because of conservative objections.

North Carolina Rep. Mark Meadows, chairman of the conservative House Freedom Caucus, said a “clean” increase in the debt ceiling by the August recess is “not likely.”

The Freedom Caucus on Wednesday took an official position on the matter, saying they want Congress to address the issue before the August break but also saying they oppose a “clean” raise.

“We demand that any increase of the debt ceiling be paired with policy that addresses Washington’s unsustainable spending by cutting where necessary, capping where able, and working to balance in the near future,” the caucus said in a statement.

Rep. Greg Walden, Oregon Republican and chairman of the Energy and Commerce Committee, said that with unified Republican government now, he’s hoping for productive negotiations and a path forward.

“Passing a debt ceiling is always a difficult” vote, Mr. Walden said. “This is a different time, because you have one party in the majority [in] the House and Senate and [the] same party in the White House.”

“At the end of the day, the country needs to pay its bills,” he said.

Rep. John Larson, Connecticut Democrat, said Mr. Mnuchin is right and that there should be a resolution before Congress breaks for recess.

“We cannot leave here in August and have the uncertainty that will result from this, and the gaming and the politics that will take place,” Mr. Larson said. “It could be a calamity for the country.”