- The House will vote on Wednesday on a bill that would suspend the US debt limit, Speaker Nancy Pelosi said.
- Republicans will reject the law in the Senate because they say they will not support an increase or suspension of the debt limit.
- Democrats are trying to avert two potential crises this week: a possible government shutdown and a first-time US default.
The House will vote on Wednesday on a bill to suspend the US debt limit as the country has no clear-cut solution for the first time in a default.
If the House passes the law, Republicans will sink it in the Senate. The GOP has resisted any attempt to raise the borrowing limit and appears intent on addressing it as part of its vast investment in social programs and climate policy to Democrats.
Treasury Secretary Janet Yellen has told lawmakers that the US will run out of ways to pay its bills around October 18. If Congress fails to suspend or raise the debt limit before the deadline, lawmakers risk a default that could cost millions of jobs, jeopardize government profits and crash financial markets.
House Speaker Nancy Pelosi, D-Calif., wrote to Democrats, “Today, the House honors its responsibility to protect the American economy and American families from the catastrophe of a default by passing legislation to suspend debt limits.” Plan to move forward.” .
The party aims to tackle two different crises this week. Thursday’s midnight deadline comes first for the government to pass the funding bill before the shutdown.
The Senate could vote as soon as Wednesday on a short-term appropriations plan that would fund the government until early December. It will then be sent to the House for approval where it is expected to be passed.
It is still grappling with the debt ceiling to Congress.
Republicans have thwarted two Democratic attempts to address the issue. GOP senators on Monday blocked a bill that would have funded the government in December as it also suspended borrowing limits until December 2022.
Republicans insist that Democrats should raise the limit on their own, leading Senate Majority Leader Chuck Schumer, D.N.Y., to introduce a proposal that would allow the Senate to raise the ceiling with a simple majority. It required unanimous consent, and minority leader Mitch McConnell, R-Ky. blocked it on Tuesday.
Republicans want to link debt ceiling increases to Democrats’ larger legislation as they make their counterparts’ tax and spending proposals a central issue in their 2022 midterm election strategy. McConnell has said repeatedly that Republicans would support a government funding bill that does not include the suspension of borrowing limits.
However, raising the loan limit does not authorize future expenditure. The US will be unable to pay its current obligations if it does not increase or suspend the limit.
Schumer has so far insisted that he will not include the debt limit suspension in Democrats’ social spending bill, which he plans to pass by a simple majority through budget reconciliation. On Wednesday, he said the party would have to amend its already passed budget proposal – the first step in reconciliation – to do so. Reconciliation allows Democrats to pass some bills without Republican votes.
Schumer said restarting the process could leave a proposal for borrowing limits in procedural delays while the US moves closer to a default.
“It’s very risky and could lead us to default, even if only one senator wants it. So you can’t do it this route,” he said.