Despite White House pleas over the debt ceiling, Congress kicks the can down the road

What did politicians gain by delaying the issue, asks John Bowden

Minority Leader Mitch McConnell says he’s done negotiating with Democrats on the issue (Getty Images)

The gridlock in the Senate broke momentarily last week resulting in members from both parties coming together to support a short-term increase in America’s debt limit, a minor victory for Democrats who previously faced a GOP unwilling at all to vote in favour of keeping the US from default.

As Congress moves into the second full week of October, however, it is becoming increasingly clear that the majority party’s victory was only temporary, and may have hardened GOP resistance for the months to come.

Facing two deadlines over the past month, Congress has extended both funding for the government at current levels as well as an extension of the borrowing limit to pay the US’s existing obligations through early December. The federal government will now run out of funding on 3 December, and the US will need to extend the debt ceiling again by around the same time.

The passage of a short-term debt limit increase was widely panned by the White House, which torched Senate Republicans repeatedly on the issue before last week’s vote and urged Congress to pass a longer-term bill.

“Why kick the can down the road?” press secretary Jen Psaki repeated several times during a press briefing.

But Congress did just that. The dates of the deadlines are just about all that has changed. Senate Republicans are publicly vowing to repeat their strategy in December and prevent Democrats from raising the debt limit without using the 50-vote budget reconciliation method; any other bill would require 60 votes or changes to the filibuster rule unless 10 Republicans voted for it to pass.

For the White House, the issue presents two problems; firstly, it distracts the body from debates over President Joe Biden’s two infrastructure bills, one of which is currently being hotly debated by members of his own party. Secondly, the issue presents a glaring contrast with the image Mr Biden presented during the 2020 campaign of restoring unity and bipartisanship in Washington, which was on a downward spiral throughout the Obama administration and plunged to new lows under former President Donald Trump.

Minority Leader Mitch McConnell has shown no signs of relenting in his refusal to help Democrats keep the US from reaching a credit default, a prospect that the Treasury secretary has said could spark a worldwide recession. Blaming Senate Majority Leader Chuck Schumer for a floor speech condemning Republicans’ brinkmanship, the Republican leader has vowed that his caucus will be unwilling to provide any votes in December for a debt ceiling hike.

“This will moot Democrats’ excuses about the time crunch they created and give the unified Democratic government more than enough time to pass stand-alone debt limit legislation through reconciliation,” he said in a statement.

Senate Democrats, on the other hand, have remained defiant in their insistence that they will not use budget reconciliation to raise the debt ceiling, a process that Mr Schumer has called both “risky” and time-consuming.

"We’re going to raise the debt ceiling, and we’re going to go on and pass infrastructure," said Sen Tammy Duckworth, a Democrat. "We’re never going to do it through reconciliation."

"They have finally done the right thing and at least we now have a couple of months in order to get another permanent solution," added Sen Bernie Sanders, chair of the Senate Budget Committee, who added: "There’s not going to be reconciliation."

What remains unclear is what option Democrats will turn to in the next two months to advance the issue.

Breaking a Republican filibuster would require 10 GOP defections in the Senate, and while highly unlikely could very well be the Democrats’ best shot at passing a debt ceiling extension. Other methods are equally if not more stonewalled; a carve-out of the filibuster for debt ceiling legislation is opposed by Sen Joe Manchin, a conservative Democrat, and therefore unlikely to change. Barring reconciliation, it isn’t clear what other options the party can pursue.

Fed up with the constant use of the debt ceiling as a political football over the past decade, Treasury Secretary Janet Yellen called on lawmakers to permanently suspend it during a congressional hearing in September.

“Yes I would,” she responded when asked if she supported a permanent suspension, adding: “I believe it’s very destructive to put the President and myself, the Treasury Secretary, in a situation where we might be unable to pay bills that result from those past decisions.”