The House will vote to suspend the debt limit on Wednesday, House Speaker Nancy Pelosi said. The move will again face Republican opposition in the Senate.
Pelosi announced the move in a letter to Democratic colleagues:
Dear Democratic Colleague,
Today, the House plans to move forward to honor its responsibility to protect the American economy and American families from the catastrophe of a default by passing legislation to suspend the debt limit.
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Thank you for the great unity and patriotism demonstrated with last week’s vote on lifting the debt ceiling and on a Continuing Resolution to keep government open and avoid a devastating shutdown.
The full faith and credit of the United States should not be questioned. This is in the Constitution: Fourteenth Amendment, Section Four states: “The validity of the public debt of the United States, authorized by law… shall not be questioned.”
The consequences of not lifting the debt ceiling include:
- Economist Mark Zandi of the nonpartisan Moody’s Analytics predicted that a default would trigger a global market panic similar to the 2008 financial crisis, which could result in a loss of six million jobs, an unemployment rate of nearly 9 percent, the elimination of $15 trillion in household wealth and a decline in real GDP of 4 percent.
- JPMorgan Chase CEO Jamie Dimon predicted that such a default “could cause an immediate, literally cascading catastrophe of unbelievable proportions and damage [to] America for 100 years.”
- According to the Joint Economic Committee, default would likely prompt a lasting downgrade of America’s credit, drastically increasing costs for car loans, mortgages, car loans, student loans, credit card bills and other borrowing.
We must act now. Yesterday, Secretary Yellen announced that by October 18th, the Treasury is set to exhaust extraordinary measures and cash on hand, leading us barreling towards a default. Nearly 50 million seniors could stop receiving Social Security checks for a time. Troops could go unpaid. Millions of families who rely on the Biden Child Tax Credit could see delays. Our economic recovery would reverse into recession. And, as the 2011 debt ceiling crisis shows, even narrowly avoiding a default costs the country billions of dollars.
The debt limit has long been a bipartisan issue. Congress has addressed the debt limit 78 times since 1960: 29 times with a Democrat in the White House and 49 times under a Republican president. More recently, since 2011, each of the seven times that the debt limit was addressed, Congress did so on a bipartisan basis. This includes three times under the last Administration, when Democrats cooperated.
Only three percent of the current debt has been accrued under President Biden. As you know, addressing the debt limit is not about future spending. This is about meeting obligations that the government has already incurred, including from the bipartisan COVID relief legislation passed in December, with the support of dozens of Republicans including Leader McConnell.
We cannot and will not allow Republicans’ extremism and utter lack of concern for families to drive our economy into the ground. Thank you for your patriotic commitment to addressing this serious and urgent need for America.
Thank you for your leadership For The People.
