Oroville Mercury-Register

White House warns that debt limit showdown could hurt states

- By Josh Boak

The White House is warning state and local government­s about severe cuts to disaster relief, Medicaid, infrastruc­ture grants, school money and other programs if Congress fails to raise the U.S. debt limit.

The administra­tion issued on Friday a fact sheet for state and local officials in an attempt to ratchet up the public pressure on Senate Republican leader Mitch McConnell. President Joe Biden has insisted so far on bipartisan backing to increase the cap on debt that was almost entirely accrued before he took office, but McConnell,

R-Ky., has been unmoved and has repeatedly said that Democrats must act on their own.

The Treasury Department has engaged in extraordin­ary measures to keep the government running after the suspended debt limit was reinstated in August at a level of $22 trillion, about $6 trillion less than the current total debt load. Treasury’s extraordin­ary measures will be exhausted by October, creating the potential for default.

The debt limit is the amount of money Congress allows the Treasury to borrow. It was suspended three times during the Trump administra­tion and has been lifted dozens

of times since 1960. Created at the start of World War I so Congress would no longer need to approve each bond issuance, the debt limit has evolved into a political

weapon as borrowing has sharply escalated over the past two decades.

McConnell has said he will not sanction further increases and that the Democrats

have the ability to go it alone.

“With a Democratic President, a Democratic House, and a Democratic Senate, Democrats have every tool they need to raise the debt limit,” the Kentucky senator tweeted on Wednesday. “It is their sole responsibi­lity. Republican­s will not facilitate another reckless, partisan taxing and spending spree.”

Biden has countered that Republican­s are to blame for the rising deficit and that his plans for child care, schooling, health care, infrastruc­ture and adapting to climate change will be fully paid for in the long term.

“Let me remind you, these are the same folks who just four years ago passed the Trump tax cut,” Biden said in Thursday remarks at the White House. “It just ballooned the federal deficit.”

With the total debt standing at $28.4 trillion, the government would be forced to cut deeply into programs unless the restrictio­ns on borrowing are lifted or suspended. The risk of a recession and turmoil in the financial market would make it harder for states and cities to borrow, while also playing havoc with public pension investment­s.

The U.S. Conference of Mayors on Friday called for a debt ceiling increase, embracing Biden’s stance that the issue should be bipartisan.

 ?? SUSAN WALSH — THE ASSOCIATED PRESS ?? Someone works on the light fixture over the North Portico of the White House in Washington on Friday.
SUSAN WALSH — THE ASSOCIATED PRESS Someone works on the light fixture over the North Portico of the White House in Washington on Friday.

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