Democrats set up fiscal standoff with GOP by pairing government funding bill with debt limit hike
D emocratic leaders announced Monday that they will pair a critical government funding bill with a provision to raise the nation’s borrowing limit, triggering a fiscal showdown with Republicans.
House Speaker Nancy Pelosi and Sen. Majority Leader Chuck Schumer said they’ll add language suspending the debt ceiling until December 2022, ignoring warnings from Republicans who have vowed to vote against any legislation that lifts the federal borrowing limit.
“Addressing the debt limit is about meeting obligations the government has already made, like the bipartisan emergency COVID relief legislation from December, as well as vital payments to Social Security recipients and our veterans,” Pelosi and Schumer said in a joint statement.
Congress must pass a temporary government funding bill by Sept. 30, the end of the fiscal year.
Treasury Secretary Janet Yellen warned lawmakers separately that the debt limit must be increased by early October in order to ensure the government can continue to pay back money already spent.
Republicans are opposed to raising the borrowing limit because they believe Democrats are spending recklessly.
Democrats, who control the House and Senate, will attempt to pass a $3.5 trillion social welfare spending bill they want to pay for in part with major tax increases. Republicans unanimously oppose the big spending package.
Democrats hope they can lure in enough Republicans to pass the government funding and debt limit package or at least put political pressure on GOP lawmakers.
House Democrats can pass the measure with a simple majority, but the Senate needs 10 Republicans to advance the package.
To attract GOP votes, Democrats will add billions in funding for states hit hard by summer storms and wildfires, an effort likely to win over at least a few GOP senators.
The Biden administration has requested $24 billion in emergency aid for those disasters, as well as an additional $6.4 billion to help Afghan refugees resettle in the United States.
In the joint statement Monday, Pelosi and Schumer said Republicans must vote for the bill because they helped pass the legislation that contributed to the debt, including COVID relief legislation in 2020.
“We believe a suspension of the debt limit through December 2022 would provide an amount of time commensurate with the debt incurred as a result of passing last winter’s bipartisan $908 billion emergency COVID relief legislation, which was authored by Republican Senators Cassidy, Romney, Portman, Collins, and others and ultimately voted for by more than 40 Republicans, including Senator McConnell, and signed into law by the previous president,” Pelosi and Schumer said in a statement.
Schumer later said in a Senate floor speech that "both parties will have to come together" to pass the debt limit increase.
Schumer also said Minority Leader Mitch McConnell, a Kentucky Republican, was acting "cravenly" by announcing that Republicans would vote against the debt limit hike.
Democrats also blame the debt on Republicans who passed major tax cuts under President Donald Trump, diminishing revenue coming into the Treasury.
Schumer warned that if the GOP blocks the bill, threatening government funding and the Treasury's ability to pay the bills, the nation could "slip back into recession and undo everything we've done to help struggling Americans pick themselves up," Schumer said.
McConnell said Monday the GOP will only support a bill that temporarily funds the government, paired with disaster relief and aid for Afghan refugees.
“We will not support legislation that raises the debt limit.”
McConnell said Democrats can pass the debt limit increase by including it in the social welfare spending package, which Democrats will pass with a simple majority and no Republican votes using a tactic called budget reconciliation.
“Since Democrats decided to go it alone, they will not get Senate Republicans’ help with raising the debt limit,” McConnell said. “Democrats decided to govern alone. They must put basic governing duties ahead of their government wishlist.”
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