By Peter Schroeder - 01/31/14 10:50 AM EST
The nation’s largest business and banking groups are urging Congress to raise the debt limit “without delay.”
In a letter sent to lawmakers Thursday, the groups warned that refusal to raise the $16.7 trillion borrowing cap “would seriously impair market operations and could have significant consequences to our fragile economic recovery.”
The push comes as lawmakers are beginning to look for a path forward on raising the debt limit. While early signals suggest the fight to avoid default will not be as dramatic as it has been in recent years, both sides are still dug in to long-held positions.
Republicans say they will not agree to a debt-limit increase without concessions to either cut spending or grow the economy, while Democrats and the White House insist a debt-limit increase is non-negotiable.
The groups did not pick sides, instead calling on the president and Congress to work together to find a solution.
“We urge you to again take the necessary steps to preserve our nation's financial standing in the world and help ensure that the American economy continues on its current path toward restored prosperity by eliminating the uncertainty as to whether or not we will incur an historic default and raising the debt ceiling,” they wrote.
While the groups want no debt-limit drama, they also took time to note that it is “long overdue” for policymakers to come up with long-term solutions to “our very real fiscal challenges.”
However, they strongly suggested the debt limit is not the place for that debate.
“Defaulting on the nation’s debt obligations should not be an option for policymakers to consider,” they wrote.
The government will reach its borrowing cap on Feb. 7, when the debt limit is again put into effect after the deal to end the government shutdown temporarily suspended it.
Treasury Secretary Jack Lew has told Congress he believes his team’s set of “extraordinary measures” to buy time before missing a payment will only last until around the end of February. He has urged Congress to hike the ceiling promptly.
Other groups joining the push were the American Insurance Association, the Consumer Bankers Association, the Financial Services Forum, the Financial Services Roundtable, the Independent Community Bankers of America, the Investment Company Institute and the Securities Industry and Financial Markets Association.