WASHINGTON (Reuters) -U.S. Senate Democrats and Republicans sought to reach an agreement on Thursday to avert a debt crisis, after Democrats showed openness to a Republican offer to allow an extension of the federal debt ceiling into December.
Democrats called off a Wednesday afternoon vote after the Senate’s top Republican, Mitch McConnell, floated the plan that would buy a couple of months to resolve the issue.
But a deal could just kick the can down the road until December, when Congress also faces a deadline for funding the government. Democrats also want to pass two massive spending bills that make up much of President Joe Biden’s domestic agenda in the coming weeks.
Senator Dick Durbin, the chamber’s No. 2 Democrat, welcomed McConnell’s offer, saying it would provide additional time for Democrats to reach an internal agreement on Biden’s multitrillion-dollar social policy package and to pass a $1 trillion bipartisan infrastructure bill.
“It was a reckless and irresponsible strategy which Senator McConnell finally realized,” Durbin told CNN. “So, he’s extended the debt ceiling till December. It still is not resolved as it should be.”
Without congressional action to raise the $28.4 trillion debt limit, the Treasury Department has forecast that it will run out of ways to pay all of its bills by Oct. 18. Republicans have blocked Democratic efforts to bring up legislation to suspend the cap.
McConnell suggested passing legislation to raise the debt limit by a fixed dollar amount, which he did not specify, until December.
That offer triggered hours of behind-the-scenes negotiations between the two sides than ran late into the night.
“We’re making good progress. We’re not there yet. But I hope we can come to an agreement (Thursday) morning,” Senate Majority Leader Chuck Schumer said on the Senate floor shortly after midnight.
There was no immediate update on Thursday morning from the offices of Schumer or McConnell.
Other Democrats said they were examining the offer.
“I think it’s a step forward. Obviously I hope we can now negotiate a process that creates a long-term solution” to the debt ceiling, said Senator Bernie Sanders, an independent who caucuses with Democrats and is a leader on the left.
McConnell on Wednesday described talks with Democrats as “trading paper … which you always do at this point.”
But while Democrats were interested in a two-month extension of the borrowing cap, they showed little interest in another suggestion by McConnell: that they use the intervening weeks to pass a longer-debt ceiling extension through a complex process called reconciliation.
Several Democrats said this would be too complicated and risky.
“We’re not going to do debt limit through reconciliation,” said Democratic Senator Debbie Stabenow. “At this point, if we can move it (the debt ceiling) till December, that just gives us more time to … get the President’s agenda done.”
Republicans, meanwhile, said they had been worried that Democrats might change a rule https://www.reuters.com/world/us/us-senate-filibuster-looms-large-leaders-seek-debt-ceiling-deal-2021-10-06 known as the filibuster that requires a supermajority of 60 votes for most legislation to advance, if the debt issue were not resolved.
The Senate is split 50-50 between the parties, which has allowed Republicans to use the filibuster to block Democratic efforts to suspend the debt limit as well as other Democratic initiatives. But Biden said late on Tuesday that Democrats would consider making an exception to the filibuster https://www.reuters.com/world/us/what-is-us-senate-filibuster-why-is-everyone-talking-about-it-2021-10-06 to hike the debt ceiling and defend the economy.
Asked if his fellow Republicans were getting concerned about getting close to a default, Senator Kevin Cramer said: “Republicans are more concerned about the prospect of blowing up the filibuster.”
Source: Economy - investing.com
