“In recent years Congress has addressed the debt limit through regular order, with broad bipartisan support. In fact, during the last administration, Democrats and Republicans came together to do their duty three times. Congress should do so again now by increasing or suspending the debt limit on a bipartisan basis,” Yellen announced in a statement.
Yellen’s statement, which is the first public stance the Biden administration has taken on the matter, comes only over one week after the two-year deal to suspend the debt ceiling expired, reimposing the legal limit on how much debt the U.S. government can owe.
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The Treasury Department is now using what it refers to as “extraordinary measures” to stop the U.S. from defaulting on its debt.
“This is a shared responsibility, and I urge Congress to come together on a bipartisan basis as it has in the past to protect the full faith and credit of the United States,” she said.
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President Biden will probably have to address the debt ceiling in October or November and either lift or suspend the limit. That deadline, though, has already set the scene for a high-stakes battle between Democrats and Republicans.
Republicans have proposed to Democrats that they should include a debt-ceiling increase in their multi-trillion-dollar reconciliation bill, which they intend to pass through a budget resolution to prevent a Republican filibuster by only needing a simple majority for passage.
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Democrats’ other option would be to convince at least 10 Republicans to vote for the debt ceiling in a stop-gap funding measure that must pass by the end of September to avert a government shutdown.
The suggestion has come with the threat from top GOP lawmakers, including Senate Minority Leader Mitch McConnell (R-Ky.), that Republicans will not back lifting the debt limit if Democrats go through with their infrastructure package.
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“If they don’t need or want our input, they won’t get our help with the debt limit increase that these reckless plans will require,” McConnell said last week. “I could not be more clear.”
Democrats are set to reveal that package on Monday. They issued a framework last month that came with a $3.5 trillion price tag.
It is not yet known if the budget resolution covers directions for lifting the debt limit.
Congress raised or suspended the debt ceiling three times under the Trump administration.
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