DURHAM, N.H. – Sen. Elizabeth Warren (D-Mass.) on Friday said Democrats should deal with the “debt ceiling” in the upcoming lame-duck session of Congress, removing the threat of an economic armageddon for the rest of President Joe Biden’s term.
“We need to act during the lame duck. We cannot let the Republicans take our economy hostage and use it as leverage to take away Social Security and voting rights from people,” Warren told HuffPost at a campaign event for Sen. Maggie Hassan (D-N.H.) in Durham, New Hampshire.
Federal law bars the government from borrowing more than a certain amount of money, forcing lawmakers to periodically raise or suspend the “debt ceiling” to prevent a federal debt default, which could cause a financial crisis and economic chaos.
Since the government runs a budget deficit every year, the total amount of accumulated debt keeps going up. The next debt ceiling deadline will come sometime next year, though the precise date is uncertain because incoming tax revenue can be unpredictable month to month.
But one thing is certain: If Republicans retake the House of Representatives, they will refuse to support a debt ceiling increase without extracting major policy concessions from Democrats.
Republicans haven’t said what they want, but House Minority Leader Kevin McCarthy (R-Calif.) has made it clear they want something. Some GOP lawmakers have suggested they ought to demand cuts to Social Security and Medicare benefits.
When Donald Trump was president, Congress raised the debt ceiling three times. Democrats did not demand concessions. But Trump has been encouraging Republicans to use the debt limit as ruthlessly as possible.
Several others in the Democratic caucus have said they shouldn’t leave the debt ceiling to next year and let Republicans take the world economy hostage. Sen. Bernie Sanders (I-Vt.) said this week that dealing with the debt limit before new lawmakers take office in January would be “a wise course of action.”
Separately, a group of House Democrats said in a letter to party leaders this week that Congress should pass a permanent debt ceiling solution before next year. One option would be to simply repeal the limit; another would give the Treasury Department unilateral authority to deal with it.
But dealing with the debt limit in the “lame duck” session of Congress would require either 10 Senate Republicans to go along or Democrats to use a time-consuming reconciliation process, which could interfere with priority legislation such as bills protecting same-sex marriage and changing the way Congress certifies elections. Ten willing Republicans would be hard to find, and Democrats seemingly did not agree among themselves when they had the opportunity to use reconciliation last year.
Another obstacle: President Joe Biden, who has said he opposes getting rid of the debt ceiling.
“That would be irresponsible,” he said last month.