Democrats to vote to avoid default on U.S. debt
After a luncheon hosted by the Senate Democratic Committee at the U.S. Capitol, Charles Schumer (Democracy Leader) addresses reporters. It was held on June 15, 2021 in Washington DC.
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One day ahead of Tuesday’s Dec. 15 deadline, Treasury Secretary Janet Yellen said that the beginning of the United States’ first ever default could be marked by a move by the Democrats in Congress to increase the debt ceiling.
This effort will begin in the Senate where Majority Leader is Chuck SchumerD-N.Y. is expected to present a resolution on debt limit Tuesday morning. This procedural approval will signal the beginning of the 10 hour-long Senate debate under the resolution. The time can be split equally between both parties.
Schumer indicated Tuesday that Democrats are likely to give up some debate time for speeding up the process. A vote may slip into the evening hours if Republicans take all of their time. However, Democrats in the chamber are likely to pass a debt ceiling increase before nightfall.
The bill will then move to the House where the small Democratic majority would likely approve it. Joe Biden’sLate Tuesday evening or Wednesday morning, he will sign it. It is likely that he will sign it within hours of the Treasury Department’s forecast that it would run out of tools to pay government bills.
Schumer stated Tuesday that the Senate resolution will increase the debt limit to “a level comparable with the funding required for 2023.” He didn’t specify the dollar value.
Yellen said that the U.S. would have no other options than to make its debt payments by December 15. The country will default if Congress fails to raise its debt ceiling by Dec. 15. According to the Treasury secretary, she believes that Washington will default if it fails to pay its debts.
After these steps, it is unlikely that a default will occur. 14 Republicans joined every Democrat last weekto permit a single vote with simple majority to lift the debt limit. Schumer and Mitch McConnell (Republican from Kentucky) reached the agreement. This ended months of GOP threats to filibuster any borrowing limit hike.
This agreement will enable Democrats to raise debt limits on their own, without the requirement of 60 votes to overcome a filibuster. To advance the bill, Democrats will need the support of every member in their caucus and tiebreaker Vice President Kamala Harir.
Democrats will likely increase the limit on borrowing by at least 2 trillion dollars. This measure will likely see the country to November’s midterm elections.
Republicans and Democrats typically work together to lift or suspend debt ceilings. The GOP asserts that Democrats must increase borrowing limits as part of their attempt to pass the $1.75 trillion climate and social security package, despite opposition from Republicans.
On Tuesday, Sen. Pat Toomey (a Pennsylvania Republican) said that “Honestly” some programs were a poor idea if money was available. He spoke about Democrats’ Build Back better plan in a segment on CNBC’s “Squawk box”.
“The idea that we’re going to throw thousands, and thousands, and thousands of dollars at American families who have plenty of income — who have income that’s multiples of the median income. We’re going to give them free programs and free money because they have a child — what is that really accomplishing?” Toomey agreed. Toomey added, “Other that undermining the sense of personal responsibility?
An increase in the debt limit doesn’t authorize any new spending. This is more like an increase in a consumer’s credit card borrowing limit, and it allows the Treasury Department continue to pay the nation’s bills.
Yellen notes often that Republicans or Democrats would have to raise the limit on debt, regardless of whether Congress has passed zero legislation by 2021.