The presumed next speaker of the House of Representatives, Republican Paul Ryan, could be elected next week, days before a momentous deadline to avoid a potentially catastrophic U.S. debt default.
The federal government hits its borrowing limit November 3, and the Obama administration is warning of dire financial and economic consequences if Congress fails to raise the debt ceiling by then.
“After November 3 we cannot borrow any more money,” U.S. Treasury Secretary Jacob Lew said Wednesday. “We’re going to be operating on a cash basis. Some days, we’ll have enough cash to pay our bills, other days we won’t. Going past November 3 is irresponsible.”
But shepherding a debt ceiling hike through a politically-polarized Congress during a House leadership change is fraught with uncertainty.
“It’s not at all clear how this is going to work out,” said analyst Stan Collender, a former staffer of both the House and Senate Budget Committees. “This is really an extraordinary situation.”
Both Ryan and outgoing Speaker John Boehner have attempted to quash speculation that a debt default might actually happen.
“I have to make clear: we’re not going to default on our debt,” Boehner told Fox News earlier this week.
“I don’t believe we’re going to default on our bonds,” said Ryan last month.
But divisions persist between Democrats and Republicans, and even among Republican factions, as to what a debt ceiling hike should consist of.
President Obama and congressional Democrats are demanding a so-called ‘clean’ increase of the borrowing limit. Republicans want to include measures ranging from spending reforms to limits on new federal regulations of the private sector.
“I hope Republicans will come to their senses and pass a clean bill to avoid a catastrophic default,” said Senate Democratic Leader Harry Reid.
Obama insists he won’t negotiate with Congress on the debt ceiling, saying it is the legislature’s responsibility to ensure that funds exist for the spending it authorizes. But many Republicans continue to view the debt ceiling deadline as a tool for extracting fiscal and other concessions from Democrats.
“Republican leadership should use every constitutional tool we have to actually address the enormous fiscal and economic problems facing this country,” said Republican senator and presidential candidate Ted Cruz.
“History has demonstrated that by far the most effective tool that Congress has to rein in a recalcitrant president is the debt ceiling,” he said.
Boehner has said he would like Congress to tackle thorny issues before he steps down, giving his successor a less taxing start as speakerSome congressional observers theorize Boehner might be open to scheduling a vote on a debt ceiling hike acceptable to the White House, and passing it with mostly-Democratic votes in the Republican-led chamber.
“The question is whether you can get enough Republicans [to pass the bill],” said Collender. “You’re going to need 30-40 [House] Republicans to vote for a clean debt ceiling.”
If the issue is not resolved before the House selects a new speaker, the task will fall to Boehner’s successor as the clock ticks down to a possible U.S. debt default.
The Senate could take the lead and pass legislation first, but Senate Majority Leader Mitch McConnell appeared to rule out that possibility earlier this week.
“We’ll have to see what the House sends over, and we will act accordingly,” said McConnell, adding that Senate Republicans “don’t prefer a clean debt ceiling.”
“This is a continuation of the government-by-crisis that we have seen for the last couple years,” said Collender. “The debt ceiling has nothing to do with approving additional spending. It has to do with paying your bills from the past.”