Politics

Debt Ceiling Options Aired but Fast Action Doubtful

Senate Majority Leader Mitch McConnell, R-Ky., is exploring options on the debt ceiling, but action is not likely anytime soon. (Bill Clark/CQ Roll Call)

By RYAN MCCRIMMON and PAUL M. KRAWZAK

Senate leaders are searching for a path forward to raise the debt ceiling, Majority Leader Mitch McConnell, R-Ky., said Tuesday, but action before the August recess appears very unlikely.

McConnell met with Democratic Leader Charles E. Schumer of New York and Treasury Secretary Steven Mnuchin earlier Tuesday to discuss plans for lifting the debt limit.

“The secretary of the Treasury, Senator Schumer and I had a good meeting this morning in my office to discuss the raising of the debt ceiling, which we all know will need to be done sometime in the next month or so,” he said at a news conference. “We’re going to be looking for a way forward to do that together, to make sure America continues to never, ever default.”

Meanwhile, CQ Roll Call has learned that behind the scenes, some Senate Republicans have been discussing various options for raising the debt limit in recent weeks, without coming to a public conclusion.

In addition, on the other side of the Capitol, one idea that has been discussed among Republican House staffers is a short-term debt limit increase until the end of the year, which would give GOP lawmakers and the White House more time to unite behind a plan for a longer-term increase, a person with knowledge of the process said.

The source added that some House Democratic aides have raised the prospect of Democrats opposing a long-term increase in the debt limit if Republicans move forward with a tax overhaul that would increase the deficit.

Treasury for months has been using so-called extraordinary measures to avoid breaching the debt ceiling, which reset on March 15. Those bookkeeping gimmicks will only allow the government to continue paying its bills until Sept. 29, Mnuchin estimated last week in a letter to Congress.

Raising the debt limit was not on McConnell’s list of items the Senate would address before leaving for the August recess, indicating a debt ceiling vote is likely in September. Both chambers are set to return to the Capitol on Sept. 5.

At a separate news conference, Schumer told reporters the meeting with McConnell and Mnuchin was not especially productive because House leaders were not involved.

“Where are the House Republicans and where is Speaker Ryan? Before we can address the debt limit, we have to know where they’re at,” he said.

Republican leaders in the House have so far offered few details of when that chamber might take up a debt limit increase or what legislation it may be combined with, if any. The House is already on recess.

House Republican lawmakers told CQ Roll Call they have heard little if any discussion of the debt limit at conference meetings.

McConnell last month told reporters he hoped to act on the debt limit before senators leave town, but that now appears unlikely.

“Yeah, ideally we would deal with the debt ceiling before the August recess,” he said on July 11.

The majority leader declined to say then what kind of increase he had in mind, when asked if a debt limit increase should be tied to spending cuts.

“We’ll see,” McConnell said. “But the debt ceiling must be raised.”

Negotiating tactics

Procuring Republican votes for a debt limit raise is likely to be a heavy lift for GOP leaders, especially if such an increase is not tied to broad spending cuts or other measures that have frequently been sought by Republicans. Democrats in both chambers have advocated for a “clean” debt limit increase that is free of other controversial add-ons.

Despite their efforts, Republicans have gotten little in exchange for a debt limit increase since 2011, when then-Speaker John A. Boehner, R-Ohio, pushed through 10-year spending cuts as part of a debt limit increase.

A debt limit vote could possibly be bundled into a fiscal 2018 appropriations package, which is needed before fiscal 2017 funding expires at midnight on Sept. 30.

It could also be rolled into other legislative items on the agenda, or be taken up as a standalone measure.

Mnuchin for months has called for a clean increase of the debt limit.

White House

On Tuesday, White House Press Secretary Sarah Huckabee Sanders said only that it was important for Congress to raise the debt ceiling “as soon as possible.”

It already appears almost certain that Congress will be unable to agree on a full fiscal 2018 spending package before the fiscal year ends Sept. 30 and will need to fall back to a temporary stopgap funding measure, perhaps until sometime in December.

If that happens, the two parties could end up negotiating a budget deal in the fall that would combine raising the defense and nondefense caps and offsetting the discretionary spending increases with changes to mandatory spending programs.

A long-term debt limit increase could potentially be attached to the budget deal.

McConnell said Tuesday that the tax overhaul will likely be facilitated by reconciliation instructions included in a fiscal 2018 budget resolution. That would potentially circumvent the need for bipartisan cooperation on taxes.

This is the first time the Trump administration has asked Congress to raise the debt limit, which had been a major flash point in the debate between former President Barack Obama and Republicans in Congress over government spending.

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