AVN 67.05 Increased By ▲ 1.85 (2.84%)
BAFL 31.05 Increased By ▲ 0.31 (1.01%)
BOP 4.88 Increased By ▲ 0.08 (1.67%)
CNERGY 3.78 Increased By ▲ 0.07 (1.89%)
DFML 14.49 Increased By ▲ 0.28 (1.97%)
DGKC 41.61 Increased By ▲ 0.56 (1.36%)
EPCL 46.22 Decreased By ▼ -0.23 (-0.5%)
FCCL 11.63 Increased By ▲ 0.23 (2.02%)
FFL 5.11 Increased By ▲ 0.06 (1.19%)
FLYNG 5.80 No Change ▼ 0.00 (0%)
GGL 10.40 Increased By ▲ 0.07 (0.68%)
HUBC 67.54 Increased By ▲ 0.67 (1%)
HUMNL 5.77 Increased By ▲ 0.06 (1.05%)
KAPCO 28.00 Increased By ▲ 0.24 (0.86%)
KEL 2.29 Increased By ▲ 0.09 (4.09%)
LOTCHEM 25.06 Increased By ▲ 0.16 (0.64%)
MLCF 21.67 Increased By ▲ 0.23 (1.07%)
NETSOL 86.06 Increased By ▲ 2.46 (2.94%)
OGDC 92.38 Increased By ▲ 6.48 (7.54%)
PAEL 11.06 Increased By ▲ 0.05 (0.45%)
PIBTL 4.23 Increased By ▲ 0.01 (0.24%)
PPL 80.15 Increased By ▲ 5.67 (7.61%)
PRL 13.64 Increased By ▲ 0.21 (1.56%)
SILK 0.89 Decreased By ▼ -0.03 (-3.26%)
SNGP 43.47 Increased By ▲ 3.07 (7.6%)
TELE 5.93 Increased By ▲ 0.07 (1.19%)
TPLP 15.82 Increased By ▲ 0.42 (2.73%)
TRG 114.88 Increased By ▲ 3.47 (3.11%)
UNITY 13.76 Increased By ▲ 0.01 (0.07%)
WTL 1.16 Increased By ▲ 0.02 (1.75%)
BR100 4,124 Increased By 87 (2.16%)
BR30 14,930 Increased By 518.1 (3.59%)
KSE100 41,191 Increased By 719.6 (1.78%)
KSE30 15,494 Increased By 331.4 (2.19%)
Follow us

WASHINGTON: President Joe Biden said on Monday the federal government could breach its $28.4 trillion debt limit in a historic default unless Republicans join Democrats in voting to raise it in the two next weeks.

Senate Republicans, led by Minority Leader Mitch McConnell, have twice in recent weeks blocked action to raise the debt ceiling saying they do want action but will not help.

Republicans say Democrats can use a parliamentary maneuver known as budget reconciliation to act alone. Top Democrats have rejected that approach.

"Raising the debt limit comes down to paying what we already owe ... not anything new," Biden told reporters at a White House news conference.

Asked if he could guarantee the United States won't breach the debt limit, the president answered: "No I can't. That's up to Mitch McConnell." He said he intended to speak with McConnell about the matter.

Biden cancels trip with agenda under threat, debt crisis looming

In a high-stakes standoff over parliamentary maneuvers. McConnell for months has been saying that Democrats should use a process called "budget reconciliation" to get around the Senate's filibuster rule, which requires 60 of 100 members to agree to pass most legislation. Senate Majority Leader Chuck Schumer, a Democrat, has rejected that approach and Biden on Monday pleaded not to use the filibuster to block action.

"Just get out of the way," Biden told Republicans. "If you don't want to help save the country, get out of the way so you don't destroy it."

Late last month the U.S. House of Representatives passed and sent to the Senate a bill to suspend the limit on Treasury borrowing through the end of 2022. Schumer was expected to hold a vote on that measure this week.

Treasury Secretary Janet Yellen last week warned lawmakers that the United States government was close to exhausting its federal borrowing capabilities by about Oct. 18.

Failure to act could have catastrophic economic consequences. Moody's last month warned that it could cause a nearly 4% decline in economic activity, the loss of almost 6 million jobs, an unemployment rate of close to 9%, a sell-off in stocks that could wipe out $15 trillion in household wealth and a spike in interest rates on mortgages, consumer loans and business debts.

Democrats note that they voted to raise the debt limit during Republican Donald Trump's administration even though they opposed deep tax cuts that added to the debt.

Biden blamed the "reckless tax and spending policies" of the previous Trump administration for the need to raise the debt limit, noting that the United States racked up nearly $8 trillion in new debt over four years, more than one quarter of the entire debt outstanding.

"Republicans in Congress raised the debt three times" under Trump, he said, with Democratic support.

Stocks Slide

Concerns over the debt ceiling contributed to Monday's drop in the stock market. Wall Street's main indexes tumbled on Monday as investors shifted out of technology stocks in the face of rising Treasury yields, with concerns about U.S.-China trade, Taiwan and the debt ceiling in the forefront.

McConnell stuck to his guns in an open letter to Biden on Monday.

Yellen urges Congress to raise debt limit to avoid financial crisis

"Senate Democrats do not need Republican cooperation in any shape or form" to pass a debt limit increase bill, McConnell wrote.

"Your lieutenants in Congress must understand that you do not want your unified Democratic government to sleepwalk toward an avoidable catastrophe when they have had nearly three months' notice to do their job."

McConnell is known for standing his ground once he takes a controversial position. For example, in 2016 he refused to allow a Senate hearing on then-President Barack Obama's nomination of Merrick Garland to a seat on the Supreme Court - holding the seat open until after Trump assumed office nearly a year later.

Schumer said the Senate will have to stay in session through the weekend and possibly into a planned recess next week if no progress is made on raising the debt limit.

Last week, the Senate's parliamentarian ruled that Schumer could use the reconciliation process to bring a debt limit bill to the Senate floor, according to a source familiar with the ruling.

According to the parliamentarian, doing so would not jeopardize Democrats' efforts to bring a second bill to the Senate floor under reconciliation.

That is the multitrillion-dollar bill embracing Biden's domestic agenda expanding social services and addressing climate change that Democrats are developing.

Comments

Comments are closed.

Biden to Republicans: 'Get out of the way' in debt-ceiling crisis

Pakistan, IMF grapple for consensus to unlock critical funding

PM Shehbaz orders immediate restoration of Wikipedia

Daraz Group lays off 11% global workforce to prepare for ‘current market reality’

Rupee up 0.46%, ends day at 275.30 against US dollar

KSE-100 jumps over 700 points amid return of positive sentiment

Pharmaceutical companies seek ‘inflationary adjustments’ in medicine prices

Second hike in two weeks: Honda Atlas jacks up car prices by up to Rs550,000

PM Shehbaz announces aid for quake-hit Turkiye

India opens its largest helicopter factory in new defence push

Govt projection of achieving $3bn current account surplus in FY23 ‘unrealistic’: PBC