Hurricane Irma is now lurking off the Florida coast….
Congress has returned to work and have started to ponder two important tasks at hand: Hurricane Harvey relief bill and the debt ceiling.
One option leaders have leaned towards is attaching the two into one bill, thus killing two birds with one stone. The House could pass the Harvey relief bill on Wednesday and send it to the Senate, who could attach the debt ceiling bill to it. Then the Senate would send it back to the House for another vote.
Treasury Secretary Steven Mnuchin has urged Congress over and over to raise the debt ceiling by September 29, which is the day Mnuchin believes the government will run out of money. The Wall Street Journal reported at the end of July:
The Treasury Department has been employing cash-conservation measures since March, when borrowing hit the formal ceiling of nearly $20 trillion. Those measures are expected to run out in early to mid-October. When they do, the government won’t have money to pay interest on debt, write Social Security checks or make millions of other routine payments, unless it can tap credit markets for borrowing to raise additional cash. Missing payments could send financial markets in a tailspin.
The path to raising the debt limit will be the first major political test for Mr. Mnuchin, a Washington novice who has been intensely focused on the Trump administration’s forthcoming tax overhaul proposal.
“Based upon our available information, I believe that it is critical that Congress act to increase the nation’s borrowing authority by September 29,” Mr. Mnuchin said in last week’s letter.
Then Hurricane Harvey made landfall in Texas on August 25 and devastated the Gulf Coast, especially around Houston. During his visit, President Donald Trump vowed to provide federal aid to let the coast rebuild. The initial Harvey bill could be $7.95 million.
Senate Majority Leader Mitch McConnell (R-KY) and Senate Majority Whip John Cornyn (R-TX) have suggested the Senate tie the debt ceiling bill to Harvey relief. From The Wall Street Journal:
Senate Majority Leader Mitch McConnell (R., Ky.) said he was acting to deliver on President Donald Trump’s top priorities of providing Harvey relief, preventing a default on the debt and avoiding a government shutdown when its current funding expires on Oct. 1.
“They are my immediate priorities as well,” Mr. McConnell said on the Senate floor Tuesday. “In the case of the debt limit, we need to act quickly given the new uncertainty from the large costs of storm recovery.”
Senate Majority Whip John Cornyn (R., Texas) later told reporters Mr. McConnell had made the decision to add an increase in the debt limit to the emergency Harvey spending measure, known as a “supplemental” spending bill, after it clears the House.
“It’s imperative we get that supplemental passed,” Mr. Cornyn told reporters. “The [Senate majority] leader’s made the decision to attach the debt limit to that, and I support that.”
On Fox News Sunday, Mnuchin said that Trump and him want Congress to tie them together. From Politico:
Over the weekend, top White House officials took to TV talk shows to warn that any new FEMA spending would deplete the Treasury Department’s coffers even quicker this month. They originally asked GOP leaders to raise the debt ceiling by the end of September, but that date is moving up with the Harvey package.
“The president and I believe that it should be tied to the Harvey funding,” Mnuchin said on Fox News Sunday. “If Congress appropriates the money, but I don’t have the ability to borrow more money and pay for it, we’re not going to be able to get that money to the state. So, we need to put politics aside.”
And a senior Senate Democratic aide cautioned against the GOP relying on Democratic votes without seeing the details of the proposal, such as how long the debt ceiling would be lifted. In recent years, Democrats have shouldered the bulk of debt and spending votes and they have significant sway over negotiations.
But Republicans leaders are concerned that preparations for Hurricane Irma, a second massive storm that could hit Florida in the coming days, could deplete FEMA’s emergency funds as soon as this week. Harvey’s destruction costs are already sucking up funding faster than leaders believed possible just a week ago — requiring quicker action on the debt limit.
“We’ll pass relief to make sure FEMA has enough money to get moving right now… But you’re going to hit that debt ceiling regardless,” House Majority Leader Kevin McCarthy (R-Calif.) told Fox Business’ Maria Bartiromo in a Tuesday morning interview. Treasury Secretary Steven “Mnuchin is telling us, ‘If you pass just a supplemental, they may not be able to put the money forward without having the debt ceiling raised.’”
Don’t forget the wildfires in California, Idaho, and Montana. Politico reported that a spokesperson from FEMA stressed that “the agency had $541 million available for Harvey relief and $472 million available for Irma and wildfires as of Monday morning.”
The spokesperson said that amount is “unlikely to last more than a week.”DONATE
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