The next debate: Debt ceiling to be tied to Harvey funding

On Sunday, Treasury Secretary Steve Mnuchin said Congress should combine a $7.9 billion disaster relief package for areas affected by Hurricane Harvey with an increase in the nation’s borrowing limit. As Congress prepares to vote on increasing the federal debt limit, the proposal to tie that decision to Harvey relief has met with congressional support among Democrats, but Republicans appear less enthusiastic.

Trump plans to meet with congressional leaders from both parties this week when the lawmakers return from their August recess. They left knowing a vote on raising the debt ceiling would be a high priority, as the federal government’s cash reserves are running low.

The debt limit has technically already been reached. While the Treasury Department uses various accounting measures to cover expenses, Mnuchin had suggested Congress raise the $19.9 trillion borrowing limit by Sep. 29, saying failure to do so would result in a default on the debt.

Mnuchin now says he’s moved that deadline up, due to unexpected new spending made necessary by Harvey’s impact on Texas.

“The president and I believe the (debt ceiling) should be tied to the Harvey funding,” Mnuchin said, during an appearance on “Fox News Sunday.” “With Harvey, it’s moved the situation up earlier. … And without raising the debt limit, I’m not comfortable that we would get the money that we need this month to Texas to rebuild.”

Hurricane Harvey’s arrival on Aug. 25, followed by record rainfall caused by downgraded Tropical Storm Harvey, created severe flooding throughout southeast Texas and Louisiana. Recovery costs are expected to reach $190 billion.

According to Senate Minority Leader Chuck Schumer (D-N.Y.) and House Minority Leader Nancy Pelosi (D-Calif.), providing Harvey relief and raising the debt ceiling is important.

In a joint statement provided by the pair, following Mnuchin’s appearance on Fox on Sunday, they wrote: “Providing aid in the wake of Harvey and raising the debt ceiling are both important issues, and Democrats want to work to do both. Given the interplay between all the issues Congress must tackle in September, Democrats and Republicans must discuss all the issues together and come up with a bipartisan consensus.”

Reportedly, Republican leaders were also making plans to couple the debt limit increase with at least the initial $7.9 billion President Trump requested for the first batch of Harvey aid. However, the chamber’s most fiscally conservative group, the House Freedom Caucus, may be opposed to combining the two.

“To attach a debt ceiling vote to increased spending is not anything that any conservative would normally support,” said Caucus group leader Rep. Mark Meadows (R-N.C.) last week. He said linking the two measures is not practical, and that it “puts everybody in a very difficult situation.”

Comprised of around 39 GOP members, the Freedom Caucus represents a powerful voting bloc, making their approval an important element in gaining the necessary approval.

House Speaker Paul Ryan (R-Wis.) did not address whether they would be tied together during an interview with “UpFront with Mike Gousha,” which aired on a Milwaukee TV station Sunday. Ryan merely stated that he was confident Congress would “step up” to fund disaster recovery efforts.

“This is something that we’ve never seen before, so it’s going to require a pretty unprecedented response,” Ryan said on Upfront.

According to The Associated Press, Senate Democrats are “cool to the approach” of combining the issues. Reportedly, a final decision regarding the combining of the issues has not been made.

After dealing with the debt-ceiling issue and the Harvey funding, Congress must also address a spending resolution by Sep. 30 in order to avoid a government shutdown.

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