- Forty-six Republican senators issued a stern warning to Democrats that they will not vote for an increase in the debt ceiling, a move which could risk the U.S. Treasury defaulting on its obligations as soon as next month.
'We will not vote to increase the debt ceiling, whether that increase comes through a continuing bill, a stand-alone resolution, or any other way, the letter, dated Aug. 10, said. 'Democrats, at any time, have the power through reconciliation to unilaterally raise the debt ceiling. They should not be allowed to pretend otherwise;
The letter is the latest maneuver in a standingoff between Republicans and Democrats over how to increase the federal government's borrowing capacity to avoid default. Democrats declined to include language to raise the debt limit in a budget resolution adopted early Wednesday morning, meaning that the next opportunity to address the issue would likely be in a stopgap funding bill that needs to pass by Sept. 30 to stop government shutdown.
So a GOP presidential candidate must join with Democrats at least 10 from the House to ensure they get paid. Republicans say they can't support President Biden's economic plan because they oppose President Joe Biden's plans to spend up to $3.5 trillion on the debt limit increase.
Only four Senate Republicans signed the letter - Richard Shelby of Maine, John Kennedy of Louisiana, Lisa Murkowski of Alaska and Susan Collins of Alabama.
Shelby is the top Republican on the Appropriations Committee, which monitors government spending. The other three Republicans not on the letter also sit on the panel.
Republicans have signaled all summer that they are unlikely to support a debt limit suspension or increase, a move they say would be tantamount to endorsing the trillions in social spending that Democrats are pushing.
It's not yet clear how quickly Congress needs to act to avoid a potential default, which would wreak havoc on the financial markets and could trigger a downgrade of government credit.
The three-year suspension of the total debt the Treasury can issue to the public and other government agencies went back into effect on Aug. 1 after a two-year suspension expired. Treasury Secretary Janet Yellen told lawmakers that Treasury could run out of special measures and exhaust its cashing capacity'soon after Congress returns from recess in September.
The Congressional Budget Office estimates that lawmakers have a wider window of time - until October or November - to raise or suspend the debt limit. The outstanding public debt is $28.6 trillion at present.
Bond market participants warned this month that, under certain scenarios, Treasury may need to execute abrupt declines in issuance of bills - a crucial component of financial markets.
The Senate has adjourned until Sept. 13, meaning they are allowed to address the issue before we end on Sept. 30 and receive government funding from the federal government. The House announced Tuesday that it would vote on the Senate budget resolution to remain unchanged but no plans have been announced to address the debt ceiling.