Thursday, May 25, 2017

Debt ceiling battle heats up again

Think that confrontations over the debt ceiling left town with the Obama? You might want to think again.

“I urge you to raise the debt limit before you leave for the summer” [on July 28], Treasury Secretary Steven Mnuchin told the House Ways and Means Committee on Wednesday according to the Wall Street Journal. Mnuchin said that he prefers a clean increase without conditions.

In response, the House Freedom Caucus released a statement opposing a clean increase. “The U.S. federal government is drowning in debt, yet continues to spend into oblivion on the backs of future taxpayers,” the statement said. “We have an obligation to the American people to tackle Washington’s out of control spending and put in place measures to get our country on the right fiscal course.”

The Freedom Caucus adopted a three-fold position on the issue. First, they categorically oppose a clean increase. Second, the group agrees that the debt ceiling should be address by Congress before it recesses for the summer. Finally, the statement demands “that any increase of the debt ceiling be paired with policy that addresses Washington’s unsustainable spending by cutting where necessary, capping where able, and working to balance in the near future.”

The government reached the debt ceiling imposed by Congress in March. Since then, the Treasury Department has been using cash conservation methods to keep the government operating. The shuffling of funds is a temporary solution that typically is only viable for a few months.

Previous estimates indicated that congressional action on the debt limit would need to be taken by late September or early October. Earlier this week, budget director Mick Mulvaney told Politico that the date might come sooner than expected.

“My understanding that the [tax] receipts, currently, are coming in slower than expected and you may soon hear from [Treasury Secretary Steven] Mnuchin about a change in the date,” Mulvaney said before the House Budget Committee.

The US national debt currently stands at $19.9 trillion. The House Freedom Caucus and other Republicans fought the Obama Administration on the debt ceiling several times during the past eight years. In exchange for increasing the debt limit, the GOP was able to win some concessions on spending from Obama and the Democrats. 

Originally published on The Resurgent

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