Senate Minority Leader Mitch McConnell (R-Ky.) said Tuesday that he is counting on House Republicans to reach a deal with President Joe Biden to address the U.S. debt ceiling and avoid a first-ever default by Washington.
Given the Democrats’ slim Senate majority of 51-49 in the new Congress and the 60-vote filibuster threshold to pass legislation, McConnell predicted that any solution the upper chamber formulated to approve a debt ceiling hike would barely win approval from the Republican-controlled House.
“I can’t imagine any kind of debt ceiling measure that could pass the Senate would also pass the House,” McConnell told reporters on Jan. 24. “So even though the debt ceiling could originate in either the House or the Senate, in this current situation, the debt ceiling fix, if there is one, or how it’s to be dealt with, will have to come out of the House,” he added.
It comes days after the U.S. government hit its $31.4 trillion borrowing limit, prompting the Treasury to begin extraordinary measures that could stave off a default until early June. Treasury Secretary Janet Yellen has called on Congress to move quickly to deliver a resolution to the debt ceiling fight. McConnell said last Thursday he is confident that the U.S. will never default on its debt and that he “would not be concerned about a financial crisis.”
The longest-serving Senate party leader has previously played crucial roles in dealing with Democrats and ending debt limit impasses. But he confirmed Tuesday that he will not lead the negotiation with the White House this time.
But efforts by congressional Republicans, including House Speaker Kevin McCarthy (R-Calif.), who are now demanding to exact spending cuts from Biden in exchange for a deal on the debt ceiling, won McConnell’s endorsement. Meanwhile, the White House and top Democrats have repeatedly rejected negotiations over spending cuts, and insist on the passage of a clean debt ceiling bill.
“It’s entirely reasonable for the new speaker and his team to put spending reduction on the table. I wish him well in talking to the president,” McConnell said. “That’s where a solution lies.”
Appearing on Fox News last week, McCarthy said that people should view the debate in the same way they would treat their “own household.” “If you had a child and you gave them a credit card, and they kept hitting the limit—you wouldn’t just keep increasing it,” the speaker said, while questioning the wasteful spending by the current administration. “You’d first see what are you spending your money on? How can we cut items out?”
Biden and McCarthy have agreed to meet to talk about the debt ceiling and other issues. But a meeting has yet to be scheduled.
Biden and top Democrats have blamed Republicans for holding the debt limit hostage to reach a spending cut agreement, warning that such demands could lead to a worst-case scenario for the country’s economy.
“If the U.S. is allowed to default on its debt for the first time, the consequences will be severe and every single American will pay the price,” Senate Majority Leader Chuck Schumer (D-N.Y.) said on the Senate floor Tuesday morning.
“A default means interest rates will spike on everything from car loans, to credit cards, to mortgages. It means that Americans will potentially have to pay thousands of dollars more a year on regular expenses. Homes will lose their value,” Schumer said. “Meanwhile, the millions of Americans who have saved for retirement will see their retirement plans like 401(k)s lose their value.”
The Democrat leader asked Republicans to bring their debt ceiling plan to the House floor.
“I say to my Republican colleagues: if you want to talk about spending cuts, then you have an obligation—an obligation—to show the American people precisely what kind of cuts you are talking about,” he said.
McCarthy said Medicare, Social Security, and the military wouldn’t be subject to spending cuts, but stressed that Biden’s demand for a debt ceiling increase without strings attached is “off the table.”
Republicans on the House Committee on the Budget, meanwhile, alleged that Democrats are shifting the public focus from the real problem.
“This apocalyptic rhetoric over the debt ceiling from my Democrat colleagues is irresponsible and distracts from the real issue — the dire necessity of reining in our unsustainable deficit spending and preventing the catastrophic consequences of a sovereign debt crisis,” committee Chairman Jodey Arrington (R-Texas) told Fox News.
For Arrington, the growing $31.4 trillion debt is more dangerous than a possible default.
“We have several months to reach a bipartisan deal, which Congress has successfully done numerous times in past debt ceiling negotiations,” he said in a Tuesday post on Twitter. “While defaulting on our debt is an unrealistic outcome, bankrupting the country and our children’s future is a real and irreparable scenario.”
Reuters contributed to this report.