Biden says republicans are ‘reckless’ in raising debt limit”
President Biden urged congressional leaders to raise the debt ceiling on Monday, rebuking Republicans for what he called "reckless" and "disgraceful" obstruction ahead of a default deadline later this month, which he warned would amount to a "self-inflicted wound that lasts" our economy over a cliff."
Mr. Biden, trying to communicate the risks to ordinary Americans, warned that they could see the effects as early as this week if Senate Democrats were unable to raise the debt ceiling. The debt ceiling governs the amount of money the government can borrow to meet its financial obligations, including Social Security checks, salaries for military personnel, and other bills.
"It starts with a simple truth: The United States is a nation that pays its bills and always has," said Biden. "If we're going to make up for what's already been approved by previous Congresses and previous presidents and parties, we're going to have to pay for it."
The remarks indicated increased public engagement by Mr. Biden on an issue that risks an economic crisis.
Mr. Biden pointed out that Republicans under President Donald J. Trump had voted several times to raise the debt ceiling, but this time are using a filibuster to block any attempt by Democrats to raise it. He said he did not expect Republicans to "do their part," but warned them "not to use procedural tricks to prevent us from getting the job done".
Technically, the United States reached its debt ceiling in late July after Congress agreed to a two-year extension in 2019. Treasury Secretary Janet L. Yellen has since taken "extraordinary measures" to delay a default. These are essentially fiscal accounting tools that curb certain government investments so that bills can continue to be paid.
Ms. Yellen warned Congress last week of "catastrophic" consequences if lawmakers fail to raise the statutory debt limit before 18. suspend or increase October, which the Treasury Department believes is the date the United States runs out of enough money to pay all its bills.
Congress is raising the debt ceiling to cover spending already authorized, and Treasury has warned that this would strain financial markets and have far-reaching effects on Americans: a default could suspend Social Security checks, delay payment for military troops, and affect payment of child tax credits.
But Republicans – who voted to raise the debt ceiling by trillions when their party controlled Washington – have moved to block a spending bill needed to avoid a default. Instead, Republicans, including Senator Mitch McConnell of Kentucky, the minority leader, have sought to shift political responsibility to Democrats, who are simultaneously trying to advance a sweeping social policy bill that could cost as much as $3.5 trillion.
"Bipartisanship is not a light switch that Speaker Pelosi and Leader Schumer can flip to borrow money and spend it to spend it," McConnell wrote in a letter to Mr. Biden Monday, referring to Senator Chuck Schumer of New York, the majority leader. "For two and a half months, we have simply been warning that since your party wants to govern alone, it must also face the debt ceiling alone."
The president said he plans to speak with Mr. McConnell about the letter. "He and I have been down this road before," Biden said.
Democrats have so far refused to raise the debt ceiling through an expedited process known as reconciliation. On Monday, Mr. Schumer told Democrats that a spending bill must reach Mr. Biden's desk within days, not weeks.
"Let me clarify the task before us: We must have a debt ceiling bill on the president's desk by the end of the week. Period. We don't have the luxury of living until 18. October to wait," he wrote in a "Dear Colleague" letter Monday.
Understand the US debt ceiling
What is the debt limit? The debt ceiling is a cap on the total amount of money the federal government is allowed to borrow to meet its financial obligations through U.S. Treasury bills and savings bonds. Since the U.S. has a budget deficit, it has to borrow huge sums of money to pay its bills.
When will the debt limit be exceeded? Technically, the U.S. reached its debt ceiling at the end of July. Treasury Secretary Janet Yellen has since used "extraordinary measures" to delay a default. Yellen warned of "catastrophic" consequences if the debt ceiling wasn't raised before a default, which the Treasury estimates could occur on 18. October would incur.
What are the consequences? Ms. Yellen told Congress that inaction could lead to a self-inflicted economic recession and financial crisis. She also said Social Security payments could be delayed, soldiers wouldn't know when their paychecks were coming, and interest rates on credit cards, car loans and mortgages would rise.
How much debt the U.S. currently has? According to the live tracker of the Peter G. Peterson Foundation, the national debt is now $28.43 trillion. Borrowing cap is set at $28.4 trillion, giving the government negligible wiggle room.
Why is the U.S. restricting its borrowing?? Under the Constitution, Congress must authorize borrowing. The debt ceiling was reached in the early 20. Introduced the first ATMs in the early twentieth century so that the Treasury would not have to ask for permission every time it needed to issue bonds to pay bills.
Is this how other countries do it?? Denmark also has a debt ceiling, but it is set so high that raising it is generally not a problem. Most other countries do not. In Poland, government debt may not exceed 60 percent of gross domestic product.
Why raising the debt ceiling is so difficult? Raising the debt ceiling has been routine for many years. But as the political environment becomes more polarized, Congress is playing an increasingly dangerous political game over the debt ceiling.
Would it be a good idea to abolish the debt ceiling? It often appears that the risk of inadvertent default outweighs the financial responsibility encouraged by the debt limit. However, it would take an act of Congress to lift the debt ceiling, and it's never easy to find agreement there.
Asked if he supported reconciliation to raise the debt ceiling, Mr. Biden said the process was "fraught with all sorts of dangers or misperceptions" and said the way to go was a vote on a bill to raise the ceiling.
Administration officials say Mr. Biden will continue to pressure Republicans to step aside – breaking their filibuster – and allow Democrats to vote themselves this week to raise the limit.
"Let's vote," said Mr. Biden. "And end of mess."
While urging congressional leaders to find a way to raise the debt ceiling, Mr. Biden still needs to muster support for a bipartisan infrastructure deal and a sweeping social spending plan.
"I was able to close the deal for 99 percent of my party," Biden said, before adding that "two people" remain opposed to the second piece, a reference to Sen. Joe Manchin III. of West Virginia, and Senator Kyrsten Sinema of Arizona.
"It's not a smart thing to negotiate with yourself in public," Biden said when asked if he would support a lower number in the reconciliation package.