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US: Trump Escalates Calls For Congress To Raise Debt Limit

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US President-elect Donald Trump has escalated calls for Congress to raise the federal debt limit ahead of his inauguration on January 20, describing a 2023 deal between President Joe Biden and former House Speaker Kevin McCarthy (R) as, "one of the dumbest political decisions made in years." Under the terms of the Biden-McCarthy deal, the debt ceiling was suspended until Jan 1, 2025, in exchange for a mechanism to limit some government spending, known as the Fiscal Responsibility Act.

  • Trump said of the 2023 deal, in a Truth Social statement: "There was no reason to do it... The Democrats must be forced to take a vote on this treacherous issue NOW, during the Biden Administration, and not in June. They should be blamed for this potential disaster, not the Republicans!"
  • Treasury Secretary Janet Yellen said in a letter to Congressional leaders on Friday that, due to a USD$54 billion decrease in outstanding debt, the Treasury "currently expects to reach the new limit between January 14 and January 23, at which time it will be necessary for Treasury to start taking extraordinary measures." Those measures are likely to postpone hitting the debt limit until late Spring.
  • Although suspending the debt limit has long been a Democrat priority, Democrats are unlikely to agree to a bipartisan measure without significant policy concessions. The most likely option for Congressional Republicans is to attach a debt limit hike to a partisan reconciliation package on energy and border security, adding another complication to Trump's legislative agenda. 
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US President-elect Donald Trump has escalated calls for Congress to raise the federal debt limit ahead of his inauguration on January 20, describing a 2023 deal between President Joe Biden and former House Speaker Kevin McCarthy (R) as, "one of the dumbest political decisions made in years." Under the terms of the Biden-McCarthy deal, the debt ceiling was suspended until Jan 1, 2025, in exchange for a mechanism to limit some government spending, known as the Fiscal Responsibility Act.

  • Trump said of the 2023 deal, in a Truth Social statement: "There was no reason to do it... The Democrats must be forced to take a vote on this treacherous issue NOW, during the Biden Administration, and not in June. They should be blamed for this potential disaster, not the Republicans!"
  • Treasury Secretary Janet Yellen said in a letter to Congressional leaders on Friday that, due to a USD$54 billion decrease in outstanding debt, the Treasury "currently expects to reach the new limit between January 14 and January 23, at which time it will be necessary for Treasury to start taking extraordinary measures." Those measures are likely to postpone hitting the debt limit until late Spring.
  • Although suspending the debt limit has long been a Democrat priority, Democrats are unlikely to agree to a bipartisan measure without significant policy concessions. The most likely option for Congressional Republicans is to attach a debt limit hike to a partisan reconciliation package on energy and border security, adding another complication to Trump's legislative agenda.