Mnuchin warns US could hit debt ceiling in early September
© Aaron Schwartz
 
"Based on updated projections, there is a scenario in which we run out of cash in early September, before Congress reconvenes. As such, I request that Congress increase the debt ceiling before Congress leaves for summer recess," Mnuchin wrote in a letter to House Speaker Nancy PelosiNancy PelosiPence says it's 'vital' for Congress to pass US-Mexico-Canada trade deal The Hill's 12:30 Report: Trump heads to California Obama, Bush among those paying tribute to Cokie Roberts: 'A trailblazing figure' MORE (D-Calif.).
 
Mnuchin sent identical letters on Friday to Senate Majority Leader Mitch McConnellAddison (Mitch) Mitchell McConnellHillary Clinton: Voter suppression has led to 'crisis in democracy' in the US New York Times authors blame Kavanaugh correction on editing error: 'There was zero intent to mislead' The Hill's Morning Report - What is Trump's next move on Iran? MORE (R-Ky.), Senate Minority Leader Charles SchumerCharles (Chuck) Ellis SchumerSchumer, Pelosi push Trump to back universal background check bill Sinema says she would back Kennedy in race against Markey Democrats threaten to withhold defense votes over wall MORE (D-N.Y.) and House Minority Leader Kevin McCarthyKevin Owen McCarthyTrump touts Washington Post story on GOP support Pence extends olive branch to Cummings after Trump's Baltimore attacks Marijuana industry donations to lawmakers surge in 2019: analysis MORE (R-Calif.).
 
The letters mark Mnuchin's first formal request that Congress vote to raise the debt ceiling before lawmakers leave for the August break. He had indicated after a Wednesday meeting with McConnell and McCarthy that he would prefer Congress act before leaving for the recess. 
 
"That is something we’re having discussions about, updating the numbers and potentially the need to do something before everybody leaves," Mnuchin said after the GOP meeting.
 
The timeline would give Congress a matter of weeks to come up with a strategy for how to raise the debt ceiling. The House is scheduled to leave on July 26 and the Senate on August 2. 
 
The debt limit was exceeded earlier this year, and the Treasury Department is now taking steps known as “extraordinary measures” to prevent the government from going over its borrowing limit.
 
Lawmakers initially had thought they would have until late September or October to raise the debt ceiling, which would let them fold the vote in with a broader spending deal.
 
But Mnuchin told Congress in May that the debt ceiling increase could happen in “late summer.” And a study released this week by the Bipartisan Policy Center said there was a “significant risk” that the government could reach its debt limit in early September unless Congress raises the cap.
 
Leadership in both chambers is still hoping to be able to negotiate a larger deal on the defense and nondefense budget caps before they leave for the August recess, into which they could fold a debt ceiling increase. 
 
Merging the two items would let them condense the number of politically tough votes. But the budget and the debt ceiling are on two different timelines. While Congress is likely to have to increase the debt ceiling in weeks, they have until January to pass a budget and avoid across-the-board cuts known as sequestration. 
 
Mnuchin's letter to Pelosi comes after the two spoke on the phone multiple times this week as they tried to negotiate a larger budget deal. They're expected to talk again on Friday. 

Pelosi told reporters on Thursday that Congress should act on a budget caps deal to raise the debt limit in the next few weeks.

"I am personally convinced that we should act on the caps and the debt ceiling,” Pelosi told reporters, “prior to recess.”
 
Read the letter below.