Congressional Democrats are anxious about a potential default on the national debt but are sticking with President Biden’s refusal to negotiate with House Republicans on cutting spending in exchange for raising the debt ceiling.
On the day after House Republicans passed a plan to raise the nation’s borrowing limit and cut spending, Democratic lawmakers were not discussing a compromise with the Republicans. Democrats said the prospect of the government’s inability to pay interest on the more than $31 trillion in national debt should not be taken lightly.
“I think we need to focus on the debt ceiling,” said Sen. Richard Blumenthal, Connecticut Democrat. “There’s an urgency here that absolutely requires immediate attention.”
Senate Majority Leader Charles E. Schumer, New York Democrat, doubled down on his view that the Republican proposal is “dead on arrival” and questioned House Speaker Kevin McCarthy’s sincerity in wanting to negotiate.
“If anything, the House’s actions have made the likelihood of default more likely,” Mr. Schumer said. “It locks the House into an unacceptable position and pulls us even further apart.”
Mr. Blumenthal said there would be no harm if Mr. Biden begins negotiations with House Republicans, but he is sticking with Mr. Schumer’s position that the House Republican bill should not be considered.
“I think the president should sit down with Kevin McCarthy to talk about the debt ceiling,” said Mr. Blumenthal. “And then, at some later point, talk about the budget. Sen. Schumer is the master of legislative timing. I’m not about to advise him about when and how he should do it, but he has been absolutely steadfast, and I totally agree with his position, which is we need to raise the debt ceiling.”
Sen. Mark Kelly, Arizona Democrat, said it is troubling that the country is so close to default without a resolution.
“We can’t be defaulting on our debt,” Mr. Kelly said. “To even get this close is not an option.”
Complicating matters is that Congress does not have a clear deadline for raising the debt ceiling. The Treasury Department began taking “extraordinary measures” in January to stave off default when the government hit its $31.4 trillion borrowing capacity.
Those emergency tactics are expected to give the government enough room to cover day-to-day expenses until at least the end of June. The exact time frame was put in doubt in recent weeks as tax revenue came in lower than economists originally expected.
The U.S. can’t legally default on its debt, but a failure by Congress to raise the cap on how much the federal government can borrow could spark a funding crisis for major programs.
Many Republican and Democratic lawmakers agree that the Constitution requires the federal government to honor its debt. That means even if Congress refuses to raise the debt ceiling, incoming tax revenue will be used to pay the roughly $500 billion in annual interest owed to the nation’s creditors.
But the government would only be able to spend what it takes in from taxes, which means it would stop paying — or default — on some of its obligations.
“No one knows exactly how much [time we have]. … It’s going to take some gyrations,” said Sen. John Hickenlooper, Colorado Democrat.
Despite acknowledging concern about a first-ever default, most Democrats say Mr. Biden is right to refuse to negotiate with House Republicans until they pass a debt limit bill without conditions.
“There’s not a clear answer except to say, ‘Let’s just take this [default] off the table, and let’s then roll up our sleeves and get to work on whatever a negotiated budget will look like,’” Mr. Hickenlooper said.
Sen. Amy Klobuchar, Minnesota Democrat, and Sen. Joe Manchin III, West Virginia Democrat, said even before the House passed its measure that Mr. Biden should sit down with Mr. McCarthy. Ms. Klobuchar said they should negotiate on the fiscal 2024 budget separately from the debt limit.
Sen. Tim Kaine, Virginia Democrat, said that even if the debt limit is raised first, Republicans would be in a good position to negotiate fiscal cuts by the very nature of their control of the House.
“I think the right answer is still to raise the debt ceiling and then have a really tough budget negotiation, but not allowing Republicans to threaten default to get their budget negotiations,” said Mr. Kaine, who sits on the Senate Budget Committee. “Republicans have enormous leverage in a budget negotiation.”
Republicans refuse to budge on raising the debt limit without adequate spending cuts.
Mr. McCarthy pushed through legislation Wednesday to increase the debt limit by $1.5 trillion until May 2024 while slashing $4.8 trillion in spending.
“Now, the president can no longer put this economy in jeopardy,” said Mr. McCarthy. “We have lifted the debt limit; we have done our job. We are the only body that passed anything.”
The speaker said of Mr. Biden, “Not only did we show you a plan, we’re the only ones to pass a plan. So I think it’s up to you now. Republicans raised the debt limit. You have not. Neither has [Mr.] Schumer.”
The Senate Republicans’ campaign committee noted Mr. Biden’s 2020 campaign claim that he was a master deal-maker with Republicans during his decades in the Senate.
“I know how to make government work,” Mr. Biden said on the campaign trail in 2019. “Not because I’ve talked or tweeted about it, but because I’ve done it. I’ve worked across the aisle to reach consensus to help make government work in the past. I can do that again with your help.”
Overall, the House Republican bill would raise the debt limit and cut federal spending by $130 billion for the upcoming fiscal year and limit budget growth to 1% annually over the next decade. It also would rescind at least $90.5 billion in unspent pandemic relief, cancel Mr. Biden’s student loan forgiveness program and scrap green energy tax credits that Democrats passed last year.
Beyond cutting spending, the legislation would overhaul the nation’s energy permitting laws, impose work requirements on social welfare programs and require congressional approval for any new regulations with an economic impact of more than $100 million per year.
“If you look at this package, it represents the most commonsense, straightforward approach to addressing the spending problem that got us here as we confront the debt ceiling,” said House Majority Leader Steve Scalise, Louisiana Republican.
Mr. Biden has said he will veto the bill if it reaches his desk. The president has refused for months to negotiate on raising the debt limit. He said both Democrats and Republicans have contributed to the national debt.
“They’re putting our economy in jeopardy by threatening to refuse to pay America’s bills that took 200 years to accumulate, by the way,” said Mr. Biden. “Not this year, last year, [but] 200 years.”
• Haris Alic can be reached at halic@washingtontimes.com.
• Ramsey Touchberry can be reached at rtouchberry@washingtontimes.com.
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