October 16, 2021

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Nancy Pelosi casts doubt on traditional debt ceiling standoffs – Business Insider

3 min read
  • Speaker of the House Nancy Pelosi said the debt ceiling standoff might not need to be “tradition.”
  • The GOP has been refusing to help Democrats raise the ceiling as the US faces a debt default.
  • Congress has been voting on raising the ceiling since 1917, but it’s become a political weapon this century.

The partisan fight over raising the debt ceiling is intensifying in Congress as the date when government will run out of money is approaching. Speaker of the House Nancy Pelosi suggested on Thursday there’s doubt over whether those fights — typically instigated by Republicans, as in this case — will continue.

“Congress has taken up a tradition of having to vote on that,” Pelosi told reporters. “There’s some doubt as to whether that should be the case.”

Pelosi’s vague remarks may turn out to have no consequence, but they could signal that one of Washington’s most powerful figures intends to put an end to decades of “hostage-taking,” as some Democratic senators have called it. 

Treasury Secretary Janet Yellen told Congress earlier this month that the government’s money would likely run out in October — earlier than expected — because of financial uncertainty caused by the pandemic, and Republican lawmakers have since been adamant that they won’t help Democrats raise the debt ceiling, citing Democrats’ “irresponsible spending” on their $3.5 trillion social-spending bill.

On Tuesday, Pelosi led the House in passing a government funding bill linked with a debt ceiling suspension, but Senate Minority Leader Mitch McConnell quickly struck it down, saying the GOP won’t vote for anything that includes raising the debt limit.

Pelosi has remained adamant that raising the debt ceiling should be bipartisan, and she’s cited how Republicans voted three times to raise the debt ceiling under President Donald Trump — when the nation racked up $8 trillion in debt due to GOP tax cuts and pandemic relief packages.

Insider’s Joseph Zeballos-Roig and Ben Winck reported on this “tradition,” with the debt ceiling being introduced in 1917 to encourage the government to slow borrowing. Over the past 50 years, the government has raised it 57 times. And while the US has managed to avoid defaulting on its debt during that time, the nation’s debt has still steadily climbed higher, and the debt limit has served more as a political weapon than a true threshold.

For example, in 1995, Republicans battled with President Bill Clinton over a debt ceiling raise, and similar showdowns have happened throughout the years, like in 2013 when the GOP refused to raise the debt ceiling unless the Affordable Care Act was defunded. Republicans typically raise the debt ceiling with Democratic support when the president is a Republican, though.

Democrats have yet to announce an alternative plan to raise the ceiling should Republicans strike it down, but Insider’s Zeballos-Roig and Andy Kiersz reported there is a unusual way they could sidestep this: minting a $1 trillion platinum coin. It’s unclear if Pelosi was referring to that approach on Thursday.  

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