Leaders on Capitol Hill were in discussions past midnight over raising the debt limit and avoiding economic catastrophe.
To recap: Congress must vote to raise the country’s debt ceiling, our artificially imposed borrowing limit, by 18 October, or risk the US defaulting on its debts for the first time in its history. Defaulting on our debts means “salaries to service members will stop. Benefits to veterans will stop, and much more,” Joe Biden said yesterday.
“A failure to raise the debt limit will undermine the safety of the United States’ treasury securities, threaten reserve status of the dollar as a world currency that the world relies on, downgrade America’s credit rating and result in a rise in interest rates for families talking about mortgages, auto loans, credit cards,” he continued.
Democrats could raise the debt limit with a simple majority vote, which they have, but Republicans have twice used the filibuster to block their efforts – it takes 60 votes to break a filibuster.
Republicans want Democrats to raise the debt limit “on their own” via budget reconciliation, a lengthy and complicated process ironically meant to make legislation easier to pass in the Senate – and one that would also stymie the Biden legislative agenda. Congress can at most only consider three budget reconciliation bills a year – one has already gone to the Covid bill this year, and with the “human infrastructure” reconciliation bill and voting rights still ahead, Democrats rightfully want to reserve this tactic for their heavier legislation.
So Democrats decided to bluff, with Biden pulling an about-face on his stance on changing the filibuster rules and senator Chris Coons teasing that they possibly had 50 votes to do so. Centrist Democrat senator Joe Manchin pretty much immediately killed that lie, saying his stance on the filibuster hadn’t changed, but soon after, senate minority leader Mitch McConnell came forward with the smallest of concessions.
McConnell proposed either a short-term, fixed-amount raise of the debt ceiling, to December, or an expedited budget reconciliation process.
Leadership spent the rest of the night in meetings discussing these deals, and that brings us to now.
Some Democrats are saying that these proposals are still not enough: McConnell would still be asking for budget reconciliation in December and Democrats absolutely do not want that.
White House press secretary Jen Psaki said yesterday said while discussions were still ongoing, there was a clear solution in that Republicans could just stop using the filibuster to block the Democrats and allow them to raise the debt ceiling on their own without budget reconciliation.
“We could get this done today,” she said. “We don’t need to kick the can. We don’t need to go through a cumbersome process that every day brings additional risks.”