Treasury gives Congress a debt-ceiling deadline

Updated
Treasury gives Congress a debt-ceiling deadline
Treasury gives Congress a debt-ceiling deadline
Associated Press

U.S. military intervention in Syria appears increasingly likely; a government-shutdown deadline looms; and congressional action is needed on everything from agriculture to immigration. Is there anything else that can make matters a little more complicated for Washington this fall? Of course there is.

We’ve known for months that Congress will have to raise the debt ceiling later this year, but it wasn’t clear when, exactly. There was some speculation that action may not be necessary until November or possibly even December.

Yesterday, Treasury Secretary Jacob Lew announced that the deadline would actually be far sooner.

Unless Congress raises the debt ceiling, the Treasury Department said on Monday that it expected to lose the ability to pay all of the government’s bills in mid-October.

That means a recalcitrant Congress will face two major budget deadlines only two weeks apart, since the stopgap “continuing resolution” that finances the federal government runs out at the end of September.

In theory, unlike the other national and international challenges facing U.S. policymakers, raising the debt limit is extraordinarily easy. This is, after all, quite literally routine paperwork – completing the task and avoiding the crisis could take all of five minutes. There are no easy answers for so many of the pending problems, but Congress agreeing to allow the United States to meet its financial obligations is practically effortless.

At least, it could be, and would be were it not for the fact that congressional Republicans are comfortable holding the nation hostage and threatening to trash the full faith and credit of the United States for the first time in the nation’s history.

To date, GOP leaders have not said what kind of ransom they expect for agreeing to pay their own bills, but as far as the White House is concerned, it doesn’t much matter – there will be no negotiations with those threatening to hurt Americans on purpose.

Indeed, White House Press Secretary Jay Carney left no wiggle room on the subject yesterday, telling reporters, “Let me reiterate what our position is, and it is unequivocal. We will not negotiate with Republicans in Congress over Congress’ responsibility to pay the bills that Congress has racked up, period.” He added, “We have never defaulted, and we must never default. That is our position, 100 percent, full stop.”

Complicating matters slightly further, Congress won’t have much time to play dangerous games – House Republicans have said they’re only willing to work nine days in the entire month of September, which leaves very little time to get an enormous amount of contentious work done, against the backdrop of a foreign policy crisis in Syria.

Also consider how this coincides with the looming budget crisis. Kevin Drum summarized the landscape this way:

Politically, this means that Republicans don’t really have the option of quickly passing a 2014 budget (or a short-term continuing resolution) and then taking some time off to plan for their latest round of debt ceiling hostage-taking at the end of the year. If mid-October really is the drop-dead date, it means that budget negotiations in late September and debt ceiling negotiations in early October pretty much run right into each other. It’s Fiscal Cliff v2.0.

Again, it’s important to emphasize that this doesn’t have to to be difficult. Congressional Republicans, in theory, can choose to be sane – they can turn off the sequester that’s hurting the country; they can approve a compromise budget that keeps the government’s lights on; and they can choose not to put Americans through another damaging debt-ceiling crisis. It’s simply a matter of will.

Whether this is in any way realistic is another matter entirely. We’ll find out soon enough – the new debt-limit deadline is just eight weeks away.

Debt, Debt Ceiling and Jacob Lew

Treasury gives Congress a debt-ceiling deadline

Updated