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Wednesday October 22, 2014

Washington News

Washington Hotline

House Thanksgiving Debt Limit Plan

As of Friday, October 11, the House had advanced a plan to increase the debt ceiling. The proposed plan would provide another six weeks for Congress to negotiate a new budget agreement. The deadline would extend the current "extraordinary internal financing" by the Department of the Treasury until the Congressional recess planned for the Thanksgiving holiday.

Leaders of both the House and Senate met with President Obama on Thursday. There was discussion of both a temporary debt ceiling increase and a budget compromise. The parties could not agree on such short notice on a budget compromise, but a tentative decision was made to implement a temporary debt limit increase.

White House Press Secretary Jay Carney stated that President Obama would sign a "clean" debt increase.

Editor's Note: The two very contentious issues debated the past week were the budget and the Affordable Care Act. However, House Budget Chair Paul Ryan (R-WI) did not mention the Affordable Care Act in an editorial he wrote for a national publication. It is possible that the House focus is now moving to address the budget issues. House Ways and Means Chair Dave Camp (R-MI) stated that he still is hopeful for "fast track" tax reform instructions in any budget compromise. However, the government is still partially closed pending future budget negotiations. The six week extension of the debt limit provides Congress with a fairly short window of time to resolve complicated budget issues.

Treasury Secretary Lew Urges New Funding

On Thursday, October 10, Treasury Secretary Jacob Lew testified before the Senate Finance Committee. He urged Congress to reopen the government. Lew stated, "No Congress in 224 years of American history has allowed our country to default, and it is my sincere hope that this Congress will not be the first. At the same time, Congress should pass legislation to fund the government and end the standoff."

Senate Finance Chair Max Baucus (D-MT) quoted Abraham Lincoln who spoke before the Illinois legislature when he was a young representative. Lincoln stated, "If [danger] ever reaches us, it must spring up amongst us; it cannot come from abroad. If destruction be our lot, we must ourselves be its author and finisher. As a nation of free men we must live through all time or die by suicide."

Baucus observed that the nation is facing an urgent deadline. He continued, "In seven days, the United States Treasury will have exhausted all extraordinary measures to stay under the debt limit. In seven days, the United States will be at risk of defaulting on payments. The United States of America – the richest, most powerful nation in the world – will be forced to look for loose change in the sofa in order to pay its bills."

The Ranking Member of the Senate Finance Committee is Sen. Orrin Hatch (R-UT). He emphasized that a budget agreement will need to address changes on entitlements if it is to be a comprehensive plan. He stated, "Secretary Lew, I will remind you that I have put forth five modest reform proposals for our health entitlement spending, and personally gave them to the President earlier this year."

Published October 11, 2013

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