Jan. 12 (Bloomberg) -- Senate Democratic leaders urged President Barack Obama to take any steps he can to pay U.S. financial obligations if congressional Republicans don’t support a debt-limit increase that Democrats deem acceptable.
In a letter to Obama yesterday, Senate Majority Leader Harry Reid and three other top Democrats said Obama “must be willing to take any lawful steps to ensure that America does not break its promises and trigger a global economic crisis -- without congressional approval, if necessary.”
The Democrats’ letter sharpens the dispute with Republicans over the borrowing limit, which the U.S. hit at year’s end. Amid Republican opposition to raising the debt ceiling without spending cuts, some Democrats have proposed invoking the Constitution’s 14th amendment and minting a platinum coin with a face value of $1 trillion to pay government bills.
House Speaker John Boehner of Ohio and Senate Minority Leader Mitch McConnell of Kentucky, both Republicans, have said they will seek substantial spending cuts in exchange for any debt-ceiling increase. Boehner has said cuts must match or exceed the amount the ceiling is raised.
McConnell said yesterday that Democrats “are falling all over themselves in an effort to do anything they can to get around the law -- and to avoid taking any responsibility for Washington’s out-of-control spending.”
In a statement, McConnell added that “avoiding this problem will only make it worse, which is why many of us view the upcoming debt-limit debate as a perfect opportunity to face up to Washington’s spending.”
The U.S. reached the statutory borrowing limit on Dec. 31, and the Treasury Department is using what it terms “extraordinary” measures to finance the government. The Congressional Budget Office estimates those steps will be exhausted by mid-February.
Obama must act on his own to prevent default “in the event that Republicans make good on their threat by failing to act, or by moving unilaterally to pass a debt-limit extension only as part of unbalanced or unreasonable legislation,” wrote Reid of Nevada and Senators Richard Durbin of Illinois, Charles Schumer of New York and Patty Murray of Washington.
White House spokesman Jay Carney told reporters on Jan. 9 that the administration was “not going to negotiate” on the debt limit. He said Obama won’t send aides or Vice President Joe Biden to Capitol Hill to negotiate with Republicans over their demand for at least a dollar in spending cuts for every dollar that the debt ceiling is raised.
Obama also won’t summon congressional leaders to the White House to discuss a debt-ceiling deal, Carney said.
Carney repeated that the administration doesn’t think the president has the power to unilaterally raise the limit under the Constitution’s 14th Amendment, an argument advanced by some congressional Democrats, including House Democratic leader Nancy Pelosi.
“You must make clear that you will never allow our nation’s economy and reputation to be held hostage,” Reid and his colleagues said in their letter. “We support your view that an extension of the debt limit is not something for which Democrats should have to negotiate.”
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