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 House Majority Leader Eric Cantor on Friday left a spot open in his
weekly House floor schedule for "possible consideration of the
legislation related to the debt limit" on Wednesday, a sign that his
party may be closing in on some conditions for an increase in the
government's $17 trillion borrowing cap.
Some Republican lawmakers and aides said possible conditions still
under discussion include the elimination of military pension cuts
approved in December and a provision known as the "doc fix" to
prevent a drop in payments to doctors under the Medicare healthcare
program for the elderly.
These would be a far cry from past Republican debt-limit demands for
ambitious spending cuts and may be acceptable to many Democrats.
The Democrat-controlled Senate is set to begin considering a bill
next week that would eliminate the pension cuts for non-disabled
military retirees of working age, though it is unclear how this
would be paid for.
Cantor's schedule did not indicate whether the debt ceiling
legislation would contain conditions or be the "clean" increase
sought by President Barack Obama.
A spokesman for the Virginia congressman said no decisions had been
made on the bill's language.
OVERTIME PERIOD STARTS
A temporary extension of the debt ceiling expired on Friday, forcing
the U.S. Treasury Department to resort to extraordinary accounting
measures to ensure that it can continue to borrow to pay federal
obligations.
In a letter to congressional leaders, U.S. Treasury Secretary Jack
Lew said these measures would last only about three weeks.
By February 27 when they are exhausted, the government could only
pay its bills from incoming revenue and cash on hand.
"Any foreseeable cash balance would be exhausted quickly," Lew
warned in the letter.
Many Republicans say they oppose a so-called clean increase without
some measures to reduce deficits or boost economic growth. But the
party has struggled to agree on a plan that can win Republican
support and still be accepted by Obama and Senate Democrats, who are
insisting on an increase without any conditions.
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Unlike past episodes, lawmakers this time around are largely
avoiding deeply partisan demands and threats that could prompt a
standoff and financial market turmoil.
"I'm confident that the United States is not going to default on its
debt and we will resolve the need to increase the borrowing
authority of this country prior to any deadline that the Treasury
issues," Cantor said on Thursday on the House floor.
If the government started missing payments on its many obligations,
the rapid contraction in spending would weigh heavily on the
economy. Missing debt payments would make matters even worse,
possibly triggering a financial panic and an economic depression.
An influential group of corporate chief executives again weighed in
on the matter, urging congressional leaders in a letter to swiftly
pass a debt limit increase to avoid any uncertainty and a potential
increase in borrowing costs.
"Any default by the federal government on its debts would cause
devastating, long-lasting effects for all Americans," AT&T <T.N>
Chairman Randall Stephenson and United Technologies Corp <UTX.N>
Chairman Louis Chenevert, two top officers of the Business
Roundtable, wrote.
"Further, prolonged inaction that takes the government up to the
precipice would foster uncertainty, dampen consumer and business
confidence, risk higher borrowing costs, and could have immediate
consequences for hiring and investment," the executives wrote in the
letter released on Friday.
The House currently has only seven more legislative days scheduled
through the end of February in which to pass an increase. The House
will be out of session February 13-24 to accommodate a retreat for
Democratic members late next week and a Presidents Day holiday
recess the following week.
(Reporting by David Lawder; editing by
Chizu Nomiyama and G Crosse)
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