Senate Republicans Block Democrats' Debt Limit Hike, Call for Clean Bill to Avoid Gov’t Shutdown

What’s the story?

• Senate Republicans on Monday voted to block Democrats’ bill to avoid a government shutdown later this week, provide disaster relief, and suspend the debt limit through mid-December 2022, arguing that the Democratic majorities in Congress can and should raise the debt limit unilaterally given their spending plans. 
• The vote, which was expected to fall short of the 60 votes required to overcome the legislative filibuster, failed on a near-party-line vote of 48-50 after House Democrats passed the bill on a party-line vote of 220-211 last week.
• Minority Leader Mitch McConnell (R-KY) asked unanimous consent to revise the bill to a “clean” continuing resolution (CR) that would include funding for disaster relief and Israel’s Iron Dome, but that request was objected to by a Democratic senator. He added that GOP senators will support a clean CR when one is brought to the floor by Democrats. 
• Since this summer, McConnell has repeatedly signaled that the GOP won’t provide votes for raising the debt limit, and “Democrats have all the existing tools they need to raise the debt limit on a partisan basis.” Ahead of Monday’s vote, he said on the Senate floor that “there is no chance Republicans will help lift Democrats’ credit limit so they can immediately steamroll through a socialist binge that will hurt families and help China” and added:

“There is no particular tradition that the minority will always vote for debt limit hikes during united government. When Republicans had unified control in the early 2000s, then-Senators Biden and Schumer voted no on a debt limit increase and made the party in power handle it on their own. Bipartisanship is not a light-switch that Democrats get to flip on when they need to borrow money and switch off when they want to spend money. The debt suspension that expired in August covered all the debt that had been accumulated to that point. This is an argument about the future.” 

• When Majority Leader Chuck Schumer (D-NY) set up Monday’s procedural vote last week he said on the floor, “Every single member in this chamber is going on record as to whether they support keeping the government open and averting a default, or support shutting us down and careening our country towards a default.” Schumer added:

“But if Republicans vote no―as many of them are saying they will―the Republican Party will solidify itself as the party of default―the party of default. They will endanger every single American in this country―including those who rely on Social Security, Medicare benefits; they will hurt small businesses, pensioners, and our veterans.” 

• Schumer said that Monday’s vote would leave “no doubt about which party is working to solve the problems that face our country and which party is accelerating us toward unnecessary, avoidable disaster. Republicans will solidify themselves for a long time as the party of default.”

What’s next for raising the debt limit?

• A debt limit hike will be necessary before mid-October or mid-November according to the most recent estimates by budget experts as to when the federal government will need more funding to fulfill its obligations and avoid a default.
• With Republicans unwilling to raise the debt limit ahead of Democrats bringing up their $3.5 trillion spending bill, the Democratic majorities in the House and Senate will have to turn to the reconciliation process to raise it along party-lines, otherwise the “X date” will be reached and the government will default. 
• Using reconciliation for the debt limit would require Democrats in the House and Senate to approve a revised budget resolution with reconciliation instructions that raise the debt limit. They would then produce a reconciliation bill that raises the debt limit and passes both chambers on a simple majority vote. This process could occur while Congress is considering a CR and Democrats’ spending plan.
• Democrats would prefer to not use reconciliation because they would likely have to specify a dollar amount for the new debt limit (the national debt is currently about $28.7 trillion); whereas a suspension of the debt limit as proposed in the House Democrats’ bill would allow the federal government to rack up an indefinite amount of debt incurred through December 16, 2022.
• It also could prove to be a painful process. The Senate would be required to hold an amendment “vote-a-rama” for both the revised budget resolution and the reconciliation bill, which would give GOP senators two opportunities to force votes on amendments and potentially consume a substantial amount of floor time. However, it’s possible that GOP senators may not request as many amendment votes as in a typical vote-a-rama and that they could yield back debate time.

What’s next for the stopgap funding bill?

• Congress has until 11:59:59pm Thursday night to approve short-term funding for the government to avoid a partial shutdown while lawmakers negotiate funding levels for the rest of fiscal year 2022. 
• Given that Republicans are insistent on excluding the debt limit hike from the stopgap bill but have signaled their support for a clean CR with disaster relief and Iron Dome funding, Democrats will have to bring a stopgap funding bill to the floor that is capable of getting 60 votes in the Senate. 
• While the Senate’s procedural rules mean that ordinarily it could take several days for a bill to be brought to the floor, debated, and passed, it’s likely that Democratic and Republican leaders could reach a unanimous consent agreement to bypass those hurdles in bringing up the CR, potentially after allowing votes on amendments.
• Congressional leaders as of Monday seem optimistic that they will be able to avoid a shutdown. If the Senate isn’t able to secure unanimous consent for considering a clean CR, or neither chamber is able to pass one, it’s possible that a partial government shutdown could begin Friday and carry on into the weekend until lawmakers act to end the funding lapse.

— Eric Revell

(Photo Credit: Schumer: Senate Democrats via Flickr / Creative Commons | McConnell: Gage Skidmore via Flickr / Creative Commons)