As the new debt limit approaches, lawmakers are considering long-term solutions

Debt settlement and designing a $ 1 trillion coin are among the proposed solutions.


As Congress prepares for another protest over the imposition of debt, long-term solutions to the now-discriminatory issue are emerging.

The US narrowly avoided failure in October after Republicans refused to vote on a credit limit increase. Democrats instead passed a temporary extension, ending another war in early December. Treasury Secretary Janet Yellen said in a recent letter to Congress that she "had high hopes" that the Treasury would be able to finance the government on December 15. But she warned that there were cases where the Treasury would be left behind. and the remaining resources are inadequate ”beyond that mid-December day.

Debt magnitude limits how much government can borrow to pay off its debts. Since the end of World War II, the Congress has passed a limit of almost 100 debts on what used to be a normal bipartisan process for lawmakers to become a political cudgel in recent years.

With another automatic threat approaching, there may not be enough time to pass a long-term solution, but lawmakers highlight future ideas.

Attorney Brendan Boyle, D-Pa., Re-introduced a measure in February that would eliminate the debt limit. It has only seven co-sponsors, all Democrats, including House Majority Whip James Clyburn of South Carolina. A similar bill has been introduced in the Senate.

"I think that's a very good way to do it because it doesn't help," said House Budget Committee chairman John Yarmuth, D-Ky. "I mean, we've been working for 100 years. Years and we've never stopped debt in any way. And all we do is open up opportunities for evil and irrationality."

Yarmuth said he did not think Boyle's proposal would pass because it would be a "difficult political vote" for many members.

"Personally, I would like to return a billion dollars," he said. “There are some people who are serious about that. I mean, seriously, to raise it to an unreasonable number is unattainable. ”

Yellen testified in September that she fully supported debt relief.

House Majority leader Steny Hoyer, D-Md., Said in October he would like to end the debt limit because it is "a fraudulent matter" and "does not affect the debt we incur."

Transfer authority to Treasurer

Yarmuth and Boyle, deputy chair of the House Budget panel, introduced a bill in September that would transfer the power to increase debt to the Treasury Secretary, although that would give Congress the power to overturn a decision. Yarmuth said he believed there would be a better chance than a bill that would end the debt limit.

The Boyle-Yarmuth bill is "appropriate," House Speaker Nancy Pelosi, D-Calif., Said in October.

Hoyer said in October that the option to change power in the Treasury "should be possible" because Senate Majority leader Mitch McConnell, R-Ky., In 2011 proposed to take over the mandate to increase debt in Congress and give it to the president.

Remove the default threat

Shai Akabas, director of economic policy at the Bipartisan Policy Center, made a similar argument recently, suggesting in an op-ed on Roll Call that a single change could include consolidating debt limits in the budget process and giving the president the power to set the debt limit if needed.

"Specifically, if Congress fails to deliver on its mandate and passes a budget decision every April, the president will be empowered to limit the debt limit until the end of the next financial year," he wrote. "That action would have to be accompanied by a proposal to reduce debt - consider tax increases and cost reductions."

$ 1 trillion coin

Some policy experts and lawmakers also flocked to the idea of ​​a $ 1 trillion platinum coin developed by the federal government to the Federal Reserve, which the government could use to pay off the country's debt. Yellen has already rejected the proposal in early October.

"I oppose it and I do not believe we should consider it," he said in an interview with CNBC. "It's really a gimmick."


Debt default in the United States - which may be the first in the country's history - "could lead to a recession" and could jeopardize Social Security and the payment of child taxes, "Yellen said. Secretary of Defense Lloyd Austin also called the U.S. military. may not be able to pay employees, citizens or contractors.

While experts agree that failure could have catastrophic consequences for the economy, both sides in Congress continue to disagree on how to make debt increases happen.

McConnell said Democrats should address the issue themselves as they pursue a larger agenda of spending public safety funds without the support of the GOP.

Senate Majority Leader Chuck Schumer, DNY, however, has decided to re-use the arcane budget reconciliation process, as Republicans have suggested, insisting that the process be bipartisan while noting that debt cuts will be needed with or without Build Back Better . Action. However, Senate Majority Whip Dick Durbin, D-Ill., And other Democrats said last month they would consider changing room rules to make a difference to the filibuster - a common goal of freedom fighters - to raise the debt ceiling only by a majority vote.

From then on, Schumer held a rare in-person meeting with McConnell before the Thanksgiving break to discuss the debt ceiling and other issues, which the Republican leader described as "good talks on a variety of issues."

Asked about the Senate Democrats' need for his party to join them in supporting the debt limit bill, McConnell simply said: "We will agree.