GOP debt ceiling uncertainty grows

GOP debt ceiling uncertainty grows

Congressional Republicans are uncertain about the best path forward now that the deadline for increasing the nation’s debt ceiling is approaching faster than expected.

Lawmakers had expected that a hike to the debt limit wouldn’t be needed until later this year. But due to revenue falling short of expectations, the Trump administration now says it might exhaust its “extraordinary measures” to avoid default by late summer. 

In the past, Republicans have sought policy concessions for an increase in the debt limit. But it remains to be seen whether they will pursue that same strategy now that they control both chambers of Congress and the White House.

“I think it’s going to be complicated, given the other things we have to do, to try and attach a lot of policy to the debt limit,” said Sen. John ThuneJohn Randolph ThuneAviation panel recommends Trump roll back safety rules Overnight Regulation: House moves to block methane rule | Senators wrestle with allowing driverless trucks | EPA delays toxic waste rule Overnight Tech: Senate looks at self-driving trucks | Facebook to keep ads off fake news | House panel calls Equifax CEO to testify MORE (S.D.), the No. 3 Republican in the Senate and a member of the Senate Finance Committee. 

“We’re going to have budget, debt ceiling, tax reform, a whole bunch of things sort of hitting at the same time.” 

Treasury Secretary Steven Mnuchin has urged lawmakers to pass a “clean” increase in the debt ceiling — essentially new borrowing authority with no strings attached — before they leave town in August for a five-week recess.

Failure to pass an increase, the administration says, would result in the first-ever U.S. default on its debt, which could send borrowing costs booming and potentially ignite a financial firestorm.

Speaker Paul RyanPaul RyanRyan: Graham-Cassidy 'best, last chance' to repeal ObamaCare Ryan: Americans want to see Trump talking with Dem leaders Overnight Finance: CBO to release limited analysis of ObamaCare repeal bill | DOJ investigates Equifax stock sales | House weighs tougher rules for banks dealing with North Korea MORE (R-Wis.) said the timetable for debt ceiling would move up, given the administration’s latest warnings.

“We're going to be talking with our members and with the administration on how to resolve the debt ceiling,” he said. 

But an increase in the debt limit is no easy task, threatening to stoke division in the GOP. 

Conservatives have in the past demanded concessions in return for an increase to the borrowing limit, most notably during a dramatic standoff in 2011 that resulted in the first-ever downgrade of U.S. debt. 

Many conservatives remain skeptical that the nation will default and appear poised to again seek new curbs on federal spending in return for a debt increase.

While the administration is urging action without politics, the Freedom Caucus has come out against a “clean lift,” potentially complicating Ryan’s decision on how to advance legislation in the House.  

If conservatives demand concessions in return for a debt hike, Ryan could face a choice that often bedeviled his predecessor, Speaker John BoehnerJohn Andrew BoehnerSpeculation mounts, but Ryan’s job seen as safe Boehner warns Trump: Don't pull out of Korea-US trade deal GOP Rep: Ryan wasting taxpayers dollars by blocking war authorization debate MORE (R-Ohio): whether to work with Democrats on a “clean” hike or work with conservatives to pass legislation on a party-line vote.

The uncertainty about the next steps was heightened by the Trump administration’s sudden adjustment to its timeline. Many lawmakers seemed caught off guard.

When asked his approach to the debt ceiling, Sen. Orrin HatchOrrin Grant HatchFinance to hold hearing on ObamaCare repeal bill Overnight Finance: CBO to release limited analysis of ObamaCare repeal bill | DOJ investigates Equifax stock sales | House weighs tougher rules for banks dealing with North Korea Week ahead in finance: Clock ticking for GOP on tax reform MORE (R-Utah), who heads the Senate Finance Committee, said, “I haven’t thought about it.” Another Finance Committee member, Sen. Tim ScottTimothy (Tim) Eugene ScottWhy President Trump’s 'both sides' argument has merit GOP senator: 'There is no realistic comparison' between antifa and white supremacists Trump on white supremacists: ‘Pretty bad dudes on the other side also' MORE (R-S.C.), said he simply didn’t know what the approach should be. 

Thune said he wasn’t sure if Republicans would coalesce around a specific spending reform or simply agree to a clean lift, which could require Democratic votes.

Sen. Mike EnziMichael (Mike) Bradley EnziWe can't allow Congress to take earned benefits programs away from seniors Senate approves Trump's debt deal with Democrats Senate panel might not take up budget until October MORE (R-Wyo.), who heads the Senate Budget Committee and is also a member of the Finance Committee, suggested lawmakers could use the debt ceiling bill to revive an overhaul of the budgeting process that both parties have supported.

“Last year we held 13 hearings on budget reform and seemed to have a pretty good path towards bipartisan changes that would make the budget more responsible for the country,” he said.

The effort fell apart, he added, because the Budget Committee’s ranking member, Sen. Bernie SandersBernard (Bernie) SandersOvernight Defense: Senate passes 0B defense bill | 3,000 US troops heading to Afghanistan | Two more Navy officials fired over ship collisions Senate passes 0B defense bill Dems fear lasting damage from Clinton-Sanders fight MORE (I-Vt.), was not included in the process due to his presidential campaign schedule and did not sign off on the plans. 

“So we weren’t able to move forward with those, but I’m hoping that a good many of those, that both sides believe in, will be a part of some incentive for changing the debt ceiling,” Enzi said.

Democrats, who during the Obama administration urged Republicans to support drama-free debt ceiling hikes, are mulling whether to take advantage of the moment and press Republicans for concessions of their own.