Washington, D.C. – U.S. Senators Michael Bennet (D-Colo.), Brian Schatz (D-Hawai‘i), and Chris Van Hollen (D-Md.) and U.S. Representative Bill Foster (D-Ill.) introduced legislation to repeal the national debt ceiling, an arbitrary limit set by Congress on the amount of funding that the United States Treasury may borrow.
“The recurring fight over the debt limit is a manufactured political crisis. It has nothing to do with fiscal responsibility; in fact, it helps Congress avoid its duty to be fiscally responsible. We should eliminate the debt limit to permanently lift the threat of default from our economy and focus on the urgent work the American people expect Congress to do,” said Bennet.
“Paying our debts should be an automatic act, not a politicized weapon used for leverage,” said Schatz. “It’s clear that the debt ceiling is not about fiscal responsibility, but about unnecessary brinksmanship. Congress has the chance to debate federal spending, and it’s well before the bill comes due. It’s time to stop these attempts to govern through threats and defuse the bomb by eliminating the debt ceiling altogether."
“When partisan politics raises the specter of defaulting on Treasury bonds, the United States needlessly jeopardizes our financial standing and credibility across the globe. The debt limit does nothing to enhance fiscal responsibility, but those who play politics with it can put our economy at risk. Repealing the debt limit ensures that the United States will honor the financial commitments we have already made so we can focus on real solutions for responsible budgeting,” said Van Hollen.
“For too long, the debt ceiling has been weaponized during budget negotiations, creating the potential for massive disruptions to America’s financial system that would have drastic consequences for the worldwide economy,” said Foster. “Threatening to default on our debt is no different than ordering an expensive meal at a restaurant, eating it, and leaving without paying the bill. The government has an obligation to pay its bills, just as hard working Americans do. I’m proud to join with my colleagues in the Senate to eliminate the debt ceiling and the unnecessary brinksmanship it allows.”
In practice, the debt limit has no impact on government spending, which is authorized and approved through the federal budget and appropriations process. Instead, the ceiling restricts the U.S. Treasury from paying for expenditures already made by Congress. This disconnected process consistently requires Congress to raise the ceiling before it is reached, a politicized procedure that often leads to threats of defaulting on the government’s obligation to pay its bills, leading to potential financial disruptions that would cause massive damage on Main Streets across the country.
The United States is one of only two democratic countries with a statutory debt ceiling, and the only one that could single-handedly cause a global recession. Since 1960, Congress has acted more than 75 separate times to raise, temporarily extend, or revise the definition of the debt limit. In 2011, the crisis surrounding raising the debt ceiling led credit rating agency Standard & Poor’s to downgrade the U.S. government’s credit rating for the first time ever.