BSS-ENhrch_cat_news-33-5
BSS
  06 Oct 2021, 10:22

Democrats warn of looming downgrade as US faces debt default crisis

  WASHINGTON, Oct 6, 2021 (BSS/AFP) - Democratic Senate leader Chuck Schumer
warned Tuesday that the United States was flirting with a disastrous
downgrade in its credit rating as lawmakers remained deadlocked over how to
stave off a debt default with just days to spare.

  Democrats say the Senate needs to act by the end of the week to raise the
government's borrowing cap, but a vote set by Schumer for Wednesday looks
doomed to fail as the Republicans refuse to allow a simple majority vote.

  Faced with the deadlock, President Joe Biden told reporters there was a
"real possibility" of changing the rules in Congress to circumvent
Republicans.

  If the stalemate holds, the United States will not have the funds to meet
its obligations to creditors and could default on its $28 trillion debt by
October 18, according to Treasury Secretary Janet Yellen, who said Tuesday
this could trigger another recession.

  "Unfortunately, sadly and confoundingly, too many Republicans seem proud of
this moment where they're pushing us to the edge of default, and possible
downgrade," Schumer told a news conference.

  "Even now, the credit rating agencies are saying there's a possibility of
downgrade way before the 18th, which would cost American consumers, American
businesses, the American economy, a lot. After the last downgrade there were
lasting effects for years."

  Congress has raised the debt ceiling dozens of times over the decades since
setting borrowing limits, and the votes are usually bipartisan and drama-
free.

  But with one eye on the tax and spending debate that is expected to be the
focus of next year's midterm elections, the Republicans have been saying for
months they would refuse to help this time around.

  They are keen to cast White House proposals for a multi-trillion-dollar
social spending package -- on top of the $1.2 trillion infrastructure bill
backed by both parties -- as reckless.

  The party has ruled out either voting for the borrowing cap extension
themselves or allowing the Democrats to pass it with a straight majority
vote.

  Republican Senate Minority Leader Mitch McConnell is demanding Democrats
use an arcane legislative tool called reconciliation to lift the borrowing
cap on their own, with no help or consent from his side.

  But Schumer has dismissed the reconciliation process, arguing that time was
too short for the complex maneuver.

  He is forging ahead on a procedural vote Wednesday to start debate on
raising the borrowing cap under normal procedure until December 2022.

  "We do not have the luxury of using a drawn out, convoluted and risky
process," he told a news conference in the Senate.

  "We could prevent a catastrophic default with a simple majority vote
tomorrow. If Republicans would just get out of the damn way, we could get
this all done."

  President Joe Biden echoed Schumer on Twitter Tuesday, appealing to
Republicans: "If you don't want to help save the country, get out of the
way."

  • Latest News
  • Most View
Beta Version