House Dems urge Trump to prevent a default on US debts

House Dems urge Trump to prevent a default on US debts
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The top Democrats on two House committees are urging President Trump to make sure that the U.S. doesn't default on its debt, as the borrowing limit is set to be reinstated this week.

“It is imperative that you, like all of your predecessors, send a clear message that the United States will continue to pay its debts, on time, and in full,” House Budget Committee ranking member John YarmuthJohn Allen YarmuthDemocrats look to flip script on GOP 'defund the police' attacks Democrats hit crunch time in Biden spending fight Republican immigration proposal falls flat MORE (D-Ky.) and House Ways and Means Committee ranking member Richard Neal (D-Mass.) said Monday in a letter to Trump.

The federal debt limit will be reinstated on Thursday, after Congress in 2015 voted to suspend the limit through Wednesday. After that, the Treasury Department can use "extraordinary measures" on a temporary basis to avoid a default.

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Treasury Secretary Steven Mnuchin last week called on Congress to raise the debt limit "at the first opportunity," and he announced the department's plans to start using the extraordinary measures. The Congressional Budget Office said that Treasury is likely to be able to use extraordinary measures until the fall.

Neal and Yarmuth said that it is important for Congress to raise the debt limit so that the U.S. can continue to pay its obligations, such as Social Security and Medicare benefits, veterans' healthcare benefits and interest on U.S. Treasury bonds.

“You have promised the American people that you will not support Republican proposals to cut Social Security and Medicare," the lawmakers told Trump. "We would remind you that a failure to raise the debt limit would also prevent us from honoring those promises to seniors.”

Some Republican lawmakers have suggested that the U.S. could default on obligations other than paying debt service. But Neal and Yarmuth said that entertaining a default and delaying a debt-limit increase has previously had a negative impact on the economy.

“We ask you to clearly disavow this reckless and harmful position and affirm your commitment to a clean bill that honors the full faith and credit of the United States,” they said.

If Trump can't convince congressional GOP leaders to quickly raise the debt ceiling, the administration should provide Congress and the financial markets with information about how long the extraordinary measures can delay a default, Neal and Yarmuth said.