President Joe Biden urged Republican senators to “get out of the way” and urge Democrats to suspend the country’s debt limit, hoping to prevent the US government from bumping dangerously close to a credit default, as Senate Republicans Leader Mitch McConnell refused to lend his party’s help.
Biden’s criticism came on Monday when Congress faced an October 18 deadline to allow the government to borrow more to keep running after public debt totaled $28.4 trillion. The House has passed a measure to suspend the debt limit, but McConnell is forcing Senate Democrats into a cumbersome process that can stretch and achieve deadlines with little margin for error.
Both Biden and McConnell have promised the country will avoid default, yet public fighting and political stances threaten an economic slowdown. The global economy depends on the stability of US Treasury notes, and unpaid debt could crush financial markets and push America into recession. Biden noted that the debt limit applies to borrowings that have already been made, including by former President Donald Trump, and said Republicans are hurting the country by stalling the suspension of the limit.
“They need to stop playing Russian roulette with the American economy,” Biden said at the White House. “Republicans just have to let us do our job. Just get out of the way. If you don’t want to help save the country, get out of the way so you don’t destroy it.”
McConnell said without hesitation that Republicans had given Democrats a roadmap with months of warnings to deal with the debt ceiling.
“I suggest that our Democratic allies go ahead,” McConnell said at the Capitol.
Raising the country’s debt limit has become increasingly partisan, once a routine vote. It has become the preferred political weapon of Republicans to either seek concessions or to force Democrats to borrow more for unpopular votes. McConnell has linked the vote to Biden’s multitrillion-dollar tax and economic agenda that awaits Congressional approval. But Biden says the price tag for his plan would be “zero” in terms of loans, which would be paid for by raising taxes on corporations and the wealthy, which House Democrats called to make individuals earning more than $400,000 per year or more. defined as pairs. over $450,000.
Biden said he planned to speak with McConnell, who dug in with a letter of his own to the president.
“We do not have any list of demands. For two and a half months, we have only warned that since your party seeks to govern alone, it must also handle the debt ceiling alone,” the Kentucky senator wrote in Monday’s letter.
Financial markets have been relatively calm, with interest rates of less than 1.5% on 10-year Treasury notes. The rate is slightly higher than last year’s all-time low due to the spread of the coronavirus pandemic, but it is still lower than at any other time in nearly 60 years of data tracked by the Federal Reserve.
Treasury Secretary Janet Yellen has forecast the government will exhaust its cash reserves on October 18, an event she says will likely lead to a financial crisis and an economic downturn. Senate Majority Leader Chuck Schumer warned Monday that it would be dangerous for the economy to come anywhere close to that deadline.
Schumer said in a letter to Democratic senators, “Even as the X date approaches, the consequences could be catastrophic for our economy and catastrophic for American families, lowering the cost of borrowing for average Americans.” and hinder our economic recovery.”
Democrats and Republicans are at a standstill over how to handle the expansion of the debt limit. Republicans are insisting that Democrats go alone with the same legislative tools already being used to try and pass Biden’s plan to boost safety nets, health and environmental programs. Democrats say debt ceiling expansion has traditionally been a bipartisan effort and that debt limits were created under the presidents of both sides.
Schumer said that if the debt issue is not resolved this week, the Senate will likely be forced to be in session during the weekend and possibly next week when senators were to return to their home states.
Schumer also discussed the current state of play with the bipartisan $1 trillion infrastructure bill, which has already passed the Senate and stuck in the House, as well as Biden’s larger, $3.5 trillion effort on social programs and the environment. That would be offset by tax increases on corporations and the wealthy. He said the president visited with House Democrats on Friday to garner support for both measures.
“He encouraged them to be together, to compromise, and to find the sweet spot that would allow us to get our work done,” Schumer said. “I wholeheartedly agree with his sentiment – we can do this together, if we put aside our differences and find common ground within our party.”
Biden discussed the big plan with progressive House Democrats during a virtual meeting on Monday afternoon. And Schumer, House Speaker Nancy Pelosi and top White House advisers all raged at the Capitol late Monday.
“We are making progress,” Pelosi said while lashing out. Schumer said in an earlier letter to his colleagues that he needed to reach an agreement soon, preferably “days, not weeks.”
Schumer and McConnell debated debt limits in the Senate on Monday.
McConnell noted that Biden, as a senator, voted against raising the debt limit when Republicans controlled Congress and the presidency.
But Schumer said Democrats allowed an up or down vote instead of requiring a majority to overcome a filibuster. He said Republicans should follow that example when they want to bring a House-passed bill that would suspend debt limits until December…
Credit: www.independent.co.uk / Joe Biden