Senate GOP offers Biden deal for short-term debt-limit extension

Washington, Oct 6 (EFE).- Senate Republicans on Wednesday offered US President Joe Biden and his party a deal to extend the debt ceiling until December and thereby avert a government default on Oct. 18.

In a statement, Senate Minority Leader Mitch McConnell said the move to allow the short-term debt-limit extension was contingent upon the Democrats affixing a dollar amount to the debt level.

“To protect the American people from a near-term Democrat-created crisis, we will … allow Democrats to use normal procedures to pass an emergency debt limit extension at a fixed dollar amount to cover current spending levels into December,” the top-ranking Republican in the Senate said.

“This will moot Democrats’ excuses about the time crunch they created and give the unified Democratic government more than enough time to pass standalone debt limit legislation through (a) reconciliation” bill, which only requires a simple majority that the Democrats have with the vote of Vice President Kamala Harris.

“Alternatively, if Democrats abandon their efforts to ram through another historically reckless taxing and spending spree that will hurt families and help China, a more traditional bipartisan governing conversation could be possible.”

He was referring to Democrats’ plans for a $3.5 trillion spending bill that would make major new investments in child care, education, health care and climate initiatives and would need to be passed through the reconciliation process, without any support from Senate Republicans.

The task of lifting the debt limit has proved to be a thorny one for Democrats in the 50-50 Senate, since most legislation can only be advanced with 60 votes and Republicans opposed to the new spending want to paint their opponents as the party of debt increases.

Democrats’ strategy thus far has been to seek to extend the debt ceiling until December 2022 so it does not become a campaign issue in the lead-up to that year’s midterm elections in November.

McConnell, however, remains opposed to any longer-term measure.

The Senate minority leader made his offer just before the Senate was to hold a procedural vote on the bill that the Democrat-controlled House of Representatives passed last week to suspend the debt ceiling through mid-December 2022.

Senate Republicans had already warned that they would vote as a bloc against that initiative.

Biden, for his part, said Wednesday at the White House, where he met with leaders of major financial institutions such as Bank of America and Citibank, that the Republicans were the ones being irresponsible in failing to raise the debt limit.

“The United States pays its bill. It’s who we are. It’s who we’ve been. It’s who we’re going to continue to be, God willing. That’s what’s called the ‘full faith and credit of the United States,'” the president said.

“Let’s be clear: Raising the debt limit is paying our old debts. It has nothing to do with new spending or what may be coming this year or other years.”

The US faces a debt-ceiling crisis every few years because the government spends much more money that it raises in federal taxes.

In the US, unlike in other countries, the government can only issue debt up to the limit established by Congress, which has the power to raise that ceiling when it deems it appropriate.

The US never has had to suspend payment on its national debt, although it was close to doing so in 2011 when Barack Obama was in the White House.

The impasse at that time caused enormous chaos in financial markets and led to Standard & Poor’s downgrading the US’s top-notch AAA credit rating for the first time ever. EFE


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