Perspectives; Thoughts; Comments; Opinions; Discussions

Posts tagged ‘Steven Mnuchin’

High anxiety hits Senate over raising debt ceiling


Reported

Senators are growing anxious that they might have to vote to raise the nation’s debt ceiling in a matter of weeks given new estimates that the government could hit its borrowing limit earlier than expected. The debt limit was exceeded earlier this year, and the Treasury Department is now taking steps known as “extraordinary measures” to prevent the government from going over its borrowing limit.

Lawmakers had hoped they would be able to avoid the politically painful vote to raise the debt ceiling until the fall — and that it could be packaged with other legislation to fund the government and set budget caps on spending. But that could be much more difficult if Treasury’s ability to prevent the government from going over its borrowing limit ends in mid-September — just days after lawmakers would be set to return from their summer recess.

“I think we need to hustle to a caps deal as soon as we possibly can and include the debt limit in it, no doubt,” said Sen. Shelley Moore Capito (R-W.Va.), a member of the Senate Appropriations Committee.

The debt limit has been far from the front page and has been essentially put on the back burner as lawmakers debate the treatment of migrants at the border and battle over nominations and spending bills. Members of the Appropriations Committee on Tuesday were openly skeptical about whether their colleagues would jump on the issue.

“The question is, will anybody act until the urgency is on top of us?” said Senate Appropriations Committee Chairman Richard Shelby (R-Ala.). “We need to avoid the brink.”

Failing to raise the debt ceiling would be a catastrophic move that could roil worldwide financial markets. Shelby said the mere possibility that the debt ceiling could be breached in September should give “more sense of urgency” to Congress taking quick action, while Capito said it was not in “anybody’s best interest to have that fight in September up against the debt limit.”

A study released this week by the Bipartisan Policy Center said there was a “significant risk” that the government could reach its debt limit in early September unless Congress raises the cap. The estimate was a shift from its previous forecast, which estimated the debt limit could be reached in October or November, which would give Congress more breathing room.

The earlier timeline comes after Treasury Secretary Steven Mnuchin told Congress in May that the debt ceiling increase could happen in “late summer.”

Sen. John Thune (S.D.), the No. 2 Senate Republican, said it would be “preferable” for Congress to deal with the debt ceiling before leaving for the August recess, adding that a mid-September deadline “puts a lot of pressure” on lawmakers to act.

“We could write a caps deal and attach the debt limit to it, to kind of get those issues resolved before August, which I think would be in everybody’s best interest,” Thune said.

Getting a deal done this month leaves little room for error, and few are optimistic such a timeline will be met. The House is scheduled to leave town on July 26, while the Senate is set for vacation on Aug. 2. Lawmakers would return after Labor Day, on Sept. 9, which could give them less than a week to cobble together a deal.

Speaker Nancy Pelosi (D-Calif.) on Tuesday didn’t rule out action on the debt ceiling this month.

“We’ll see how those conversations go. We certainly do not want any default on the part of the full faith and credit of the United States of America,” she said. “That’s never been what we’ve been about, but there are those on the Republican side who have embraced that again and again. So, we’ll see.”

Senate Majority Leader Mitch McConnell (R-Ky.) appeared confident during a weekly leadership press conference that lawmakers wouldn’t let the United States default on its debt, but he didn’t offer a clear pathway to approving a debt ceiling increase.

“Time is running out, and if we’re going to avoid having either short- or long-term CR or either a short- or long-term debt ceiling increase, it’s time that we got serious on a bipartisan basis to try to work this out and not have the kind of chaos that goes along with our inability to come together on these important issues,” McConnell said. A CR, or continuing resolution, would fund the government at current spending levels.

Asked if Congress had to raise the debt ceiling before the August recess, McConnell sidestepped the question, saying lawmakers are in close contact with Mnuchin about the timeline but that he doesn’t “think there’s any chance that we’ll allow the country to default.”

Broader budget talks on the debt ceiling and government funding unraveled last month, with the White House floating a one-year CR and debt ceiling hike. Senate Republicans are hoping to jumpstart the negotiations with new meetings as soon as this week, though nothing was on the books as of Tuesday afternoon.

The spending deal is also crucial, as spending cuts triggered by an earlier budgetary law would snap into effect in January if Congress does not approve new spending levels. The debt ceiling fight has always had an earlier deadline, but the new estimates are moving it up further.

Shelby argued that it makes sense to link the two issues but didn’t rule out that the debt ceiling could get a stand-alone vote, or be attached to another must-pass bill, in a time crunch.

“The path is a good question,” Shelby said. “You could raise the debt ceiling without getting a caps deal, but it makes more sense to me that if you can run them parallel, they are two big issues staring us in the face.”

 

Trump announces new sanctions on North Korea


Reported

President Trump on Thursday signed an executive order imposing new sanctions on North Korea as the U.S. and its allies sought to ramp up pressure on Kim Jong Un to abandon his nuclear ambitions.

Speaking at the United Nations before a working lunch with Japanese Prime Minister Shinzo Abe and South Korean President Moon Jae-in, two key allies in the region, Trump said the order would significantly expand the U.S. ability to crack down on individuals and companies that do business with North Korea.

ADVERTISEMENT

The president said he had empowered the Treasury Department to “target any individual or entity that conducts trade in goods, services or technology” with the country. The order also includes measures designed to “disrupt critical North Korean shipping and trade networks.”

Flanked at a table by Treasury Secretary Steven Mnuchin, Vice President Pence, Secretary of State Rex Tillerson and U.S. Ambassador to the U.N. Nikki Haley, Trump expressed an urgency to curb North Korea’s nuclear and ballistics programs.

“North Korea’s missiles and weapons development is a grave threat to peace and security in our world, and it is unacceptable that others financially support this criminal rogue regime,” Trump said. “The brutal North Korean regime does not respect its own citizens or the sovereignty of other nations. A new executive order will cut off sources of revenue that fund North Korea’s efforts to develop the deadliest weapons known to human kind.”

The announcement immediately raised questions about the impact on China, which is North Korea’s largest trading partner.

“I want to be clear the order targets only one country — that country is North Korea,” Trump said. 

The president announced that he had “heard moments ago” that the Chinese had told their central bank to “immediately stop doing business with North Korea.”

“I want to thank President Xi [Jinping] of China for the very bold move he made today,” Trump said. “It was a somewhat unexpected move, and we appreciate it.”

The U.N. has passed two resolutions recently aimed at squeezing the North Korean economy by cutting off oil, labor and exports to the nation. Haley has said those measures have “strangled their economic situation,” but acknowledged it will “take a little bit of time” for the impact to be felt. 

Trump has thanked the U.N. Security Council for voting unanimously on those sanctions, but also expressed frustration that the measures do not go far enough.

“The United Nations has had representatives working on this problem for over 25 years and they have done nothing,” Trump said Thursday. “That’s why we are in the problem we are in today, in addition to other countries not doing what they should have done. Tolerance for this disgraceful practice must end now.”

In his first-ever speech to the U.N. general assembly this week, Trump threatened to “totally destroy” North Korea if it continued its provocations.

South Korean President Moon, who campaigned on the promise he would seek dialogue with North Korea and has sought to tamp down the possibility of military action, on Thursday praised Trump’s executive order.

“President Trump just talked about the executive order, through which the U.S. is going to be implementing sanctions against the DPRK,” Moon said. “That was a very major announcement made by China to take actions on the DPRK. I am very confident that such moves will contribute to complete denuclearization of DPRK.”

Japanese President Abe has taken a similar hardline approach as Trump, writing in The New York Times this week that “prioritizing diplomacy and emphasizing the importance of dialogue will not work with North Korea.” On Thursday, Abe offered “heartfelt support” for the new sanctions.

“We are going into the new stage of pressure from the viewpoint of exercising the stronger pressure, new pressures,” Abe said. “I welcome the new sanction measures of the United States.”

Before the event, there were questions about whether Trump, Moon and Abe would all be on the same page about North Korea.

This story was updated at 2:28 p.m.


Tag Cloud

%d bloggers like this: