Reporter Notebook Debt Ceiling

Reporter Notebook

Politicians play the blame game as US gets closer to debt ceiling deadline

By Annie Andersen (Political Editor)

The debt ceiling deadline is quickly approaching as Democrats and Republicans play the blame game. Meanwhile, Treasury has been using its savings to pay for all of the things the country has already agreed to pay, in a process called ‘extraordinary measures’. Those include items like Social Security payments and Medicare reimbursements. 

But that money is going to run out. The Treasury Department estimates it will happen sometime in October.

Congress knows this day is coming. Tuesday, the House passed a bill to suspend the debt ceiling again. However, it doesn’t look like that resolution will pass in the Senate.

Senate Minority Leader Mitch McConnell (R-KY) said his caucus isn’t going to vote for raising the debt ceiling. McConnell said if Democrats want to deal with it, they can put it in that $3.5 trillion spending bill.

Democrats say the debt limit debacle isn’t their doing. Senate Majority Leader Chuck Schumer (D-NY) said Republicans are doing a “dine and dash of historic proportions.” Schumer told reporters both sides have a responsibility to pay America’s debt. 

SAN Business Correspondent Simone Del Rosario said this isn’t just a Washington, D.C. problem. Ripple effects from a federal debt default could impact Americans in all walks of life.

New polling from Morning Consult shows twice as many people will blame Democrats if the United States defaults on its debt. However, 42 percent said both parties are to blame.  

That polling indicates that McConnell’s gamble might pay off when voters head to the polls.

There are a few other options to pursue, including an unorthodox plan involving the Treasury Department minting new platinum coins.

As interesting as the platinum coin solution might seem, experts have raised some questions on that plan’s legality.

“Officials of both the U.S. Treasury and the Federal Reserve System therefore would have to approve the strategy,” the Congressional Research Service wrote in a 2017 report. “Both the U.S. Treasury and the Federal Reserve, however, rejected such options in 2013,” the report continued.

“Neither the Treasury Department nor the Federal Reserve believes that the law can or should be used to facilitate the production of platinum coins for the purpose of avoiding an increase in the debt limit,” a Treasury spokesman said. “The U.S. Treasury again rejected such stratagems in 2015.”

Annie Andersen: Some say the debt ceiling deadline is like a ticking time bomb. 

The Treasury has been using its savings to pay for all of the things the country has already agreed to pay, like medicare and social security. 

But that money is going to run out— I mean you can only live off your savings for so long, right?

Congress knows this is coming… The House passed a bill to suspend the debt ceiling again- meaning America can keep spending past its limit without any penalties. 

But…it doesn’t look like it will pass in the Senate. minority leader Mitch McConnell says his caucus isn’t going to vote for raising the debt ceiling.

He says if Democrats want to deal with it, they can put it in that 3.5 trillion dollar spending bill. Maybe that’s so he can blame the Democrats for additional spending.

But Democrats say this isn’t their doing- 

Majority Leader Chuck Schumer said Republicans are doing a “dine and dash of historic proportions”… telling reporters both sides have a responsibility to pay our debt. 

7.8 trillion dollars was added to the national debt during the Trump administration.

And I recently spoke to our business correspondent Simone Del Rosario about how this can impact you personally.

Simone Del Rosario: ”The Treasury Secretary says that 50 million seniors could stop getting their social security checks.”

Annie Andersen:But here’s the thing- 

new polling from Morning Consult says twice as many people will blame Democrats if the United States defaults on its debt… 33 percent to 16 percent. However, 42 percent said both parties are to blame.  

So McConnell’s gamble might pay off when voters head to the polls.

How do you think congress should deal with the debt ceiling?

 

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The debt ceiling deadline is quickly approaching as Democrats and Republicans play the blame game. Meanwhile, Treasury has been using its savings to pay for all of the things the country has already agreed to pay, in a process called ‘extraordinary measures’. Those include items like Social Security payments and Medicare reimbursements. 

But that money is going to run out. The Treasury Department estimates it will happen sometime in October.

Congress knows this day is coming. Tuesday, the House passed a bill to suspend the debt ceiling again. However, it doesn’t look like that resolution will pass in the Senate.

Senate Minority Leader Mitch McConnell (R-KY) said his caucus isn’t going to vote for raising the debt ceiling. McConnell said if Democrats want to deal with it, they can put it in that $3.5 trillion spending bill.

Democrats say the debt limit debacle isn’t their doing. Senate Majority Leader Chuck Schumer (D-NY) said Republicans are doing a “dine and dash of historic proportions.” Schumer told reporters both sides have a responsibility to pay America’s debt. 

SAN Business Correspondent Simone Del Rosario said this isn’t just a Washington, D.C. problem. Ripple effects from a federal debt default could impact Americans in all walks of life.

New polling from Morning Consult shows twice as many people will blame Democrats if the United States defaults on its debt. However, 42 percent said both parties are to blame.  

That polling indicates that McConnell’s gamble might pay off when voters head to the polls.

There are a few other options to pursue, including an unorthodox plan involving the Treasury Department minting new platinum coins.

As interesting as the platinum coin solution might seem, experts have raised some questions on that plan’s legality.

“Officials of both the U.S. Treasury and the Federal Reserve System therefore would have to approve the strategy,” the Congressional Research Service wrote in a 2017 report. “Both the U.S. Treasury and the Federal Reserve, however, rejected such options in 2013,” the report continued.

“Neither the Treasury Department nor the Federal Reserve believes that the law can or should be used to facilitate the production of platinum coins for the purpose of avoiding an increase in the debt limit,” a Treasury spokesman said. “The U.S. Treasury again rejected such stratagems in 2015.”

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