Lew Sets Earlier Deadline for Congress to Raise Debt Ceilingby and
Nov. 3 date is two days before Treasury's previous estimate
Lawmakers holding closed-door talks to avoid U.S. default
Treasury Secretary Jacob J. Lew moved up by two days to Nov. 3 the deadline by which Congress must raise the nation’s $18.1 trillion debt limit, intensifying pressure on U.S. lawmakers to negotiate a solution.
The Treasury projections of the administration’s net resources have fallen $4 billion to $6 billion short of expectations, forcing the department to move up the date from Nov. 5, Lew said in a letter Thursday to House Speaker John Boehner. After the new deadline, the Treasury will have less than $30 billion to fund the government, “far short” of expenses on certain days, Lew said.
“The trend in our projected net resources has continued to be negative,” Lew said. “I respectfully urge Congress to take action as soon as possible, raise the debt limit without delay, and remove an unnecessary threat to our economy.”
The U.S. is trying to avoid a repeat of October 2013, when a debt-extension agreement was reached just before the Treasury had expected to run out of borrowing authority. Closed-door talks continue between the so-called “four corners” of Congress -- the majority and minority leaders in the Senate and House -- according to several congressional aides.
Boehner is pressing to get a plan passed before he leaves office to keep the nation from going into default next month, said the Republican and Democratic aides, who spoke on condition of anonymity to speak candidly.
The Ohio Republican has promised to push through some top priorities before leaving Congress at the end of the month. His plans for a smooth exit, though, have been complicated by the sudden decision by No. 2 House Republican Kevin McCarthy to not seek the speakership, which left Republicans struggling to find a successor and have roiled negotiations on debt and spending.
What’s been underscored in the talks by House Minority Leader Nancy Pelosi and Senate Minority Leader Harry Reid is that Democrats will not go along with anything but a “clean” debt-ceiling increase free of policy conditions, said the aides.
White House press secretary Josh Earnest said Thursday that the administration was concerned “we’re getting perilously close to the level of drama and delay we think is unnecessary, to put it mildly.” Despite that, Earnest said the White House remained confident lawmakers would act before the deadline.
The Treasury is using what it calls extraordinary accounting measures to stay under the borrowing limit. A cash balance of less than $30 billion would probably be depleted quickly, Lew said, as daily government expenditures can be as high as $60 billion.
The Treasury’s cash balance was $73.2 billion as of Oct. 10, down from an average of about $143 billion in the past year.
“Operating the United States government with no borrowing authority, and with only the cash on hand on a given day, would be profoundly irresponsible,” Lew said.
The government makes about 80 million payments per month, including Social Security and veteran benefits, military salaries and Medicare reimbursements, he said. Without an increase in the debt limit, the U.S. would be unable to meet such obligations for the first time in history, Lew added.
Congress can either raise the debt ceiling or suspend the cap so Treasury can borrow without exceeding it.
Emily Schillinger, a spokeswoman for Boehner, said in an e-mail his office has received Lew’s letter and “will continue to work on this issue." Pelosi, a Democrat from California, in an e-mailed statement called on Republicans to “bring forward a clean bill to honor the full faith and credit of the United States immediately.”