Early this Thursday, Congressional Democrats and Republicans reached an agreement to temporarily raise the debt ceiling until mid-December, preventing the U.S. government to default on its obligations and avoiding a potentially destructive financial crisis in the process. The deal is expected to be put on the floor of the Senate on Thursday night.
Senate Majority Leader Chuck Schumer (D-NY) said that the congressional leadership hoped to “get this done as soon as today.” Schumer’s Republican counterpart Mitch McConnell (R-KY) explained the deal saying that “the majority (Democrats) didn’t have a plan to prevent default (…) so we stepped forwards”.
The agreement in question was proposed by Senate Republicans, and it extended the line of credit of the United States government to an extra $480 billion, which is likely to finance the American treasury up to December 3rd, although the money might be enough to keep the government financed until a later date.
The issue of the debt ceiling was just one of the central issues occupying Congress over the last couple of weeks, with the potential closure of the government and the ongoing Democratic civil war over the passage of Biden’s agenda also on the center stage of Congress. Lawmakers have reached the same course of action on all three issues: procrastination, with the Legislative branch postponing the shutdown and debt ceiling issue until December, and Democrats postponing the votes on both the Bipartisan infrastructure bill and the massive $3 trillion reconciliation bill to a later date.
Mitch McConnell blinks first, allowing Democrats to raise the debt ceiling without using reconciliation
Although both parties largely agreed that the debt ceiling would have to be raised at some point, as the consequences of not doing it would result in financial chaos, both parties disagreed on how to do it. Democrats argued that Republicans needed to actively collaborate with them and not challenge the vote, while the GOP said that since Democrats have governed unilaterally all year long they could do the same with the debt ceiling issue and raise the limit through the budget reconciliation process.
This impasse had sent Congress to a frenzy this week, with Democrats scrambling to find a way to raise the debt ceiling without using the budget reconciliation route, which is the congressional approach they will use to their colossal $3 trillion spending bill. Republicans criticized Democrats for not being proactive enough over the issue, with Minority Leader Mitch McConnell saying that Democrats knew with months in advance of the Republican position over the issue and decided not to start the reconciliation process sooner.
With the deadline of October 16, the day the Federal government would run out of money closely coming, Democrats started to float the idea that it might be necessary for them to use the “nuclear option” and change the rules of the Senate to abolish the filibuster for any future debates over the debt ceiling. Although it was unclear if all Democrat Senators were behind this idea, it scared Republicans enough as McConnell proposed the short-term extension of the debt ceiling a few hours after Democrats reportedly started to consider the idea.
According to a report made by Axios, a Republican Senator said that the GOP conference decided to give Democrats a deal as the “paramount concern here is saving the 60-vote rule, saving the filibuster”.
By the time the proposal was made it was unknown how the proposal would be approved in the Senate, and it is still unclear if Republicans will let Democrats temporarily raise the ceiling while not actively voting for it or if the GOP would need to provide 10 of their own Senators to vote for the measure. Although the first option would most likely be the fastest tactic if a single GOP Senator objects then McConnell would have to whip 10 Senators to vote with the Democrats.
In the end, the Republican party found enough votes to get the debt ceiling raised, with Senator Mitch McConnell being accompanied by nine fellow GOP lawmakers to get the 60 votes needed to finalize debate over the issue. However, the solution is only temporary and the Senate will have to address the issue once again in a few months and it is unknown if Schumer and McConnell would be able to reach a similar deal again.
Some Republicans have criticized Leader McConnell for offering this deal to Democrats, with Senator Lindsey Graham (R-SC) saying that he was “ upset (…) because we had a strategy to make them pay a price to raise the debt ceiling, and we blinked”.
If there is something that this week of frantic activity (debt ceiling, government shutdown, and Democratic infighting) in Congress made clear is that lawmakers are allergic to deadlines and are, as Senator Ron Johnson (R-WI)said over the debt ceiling deal, “kicking the can down the road”.