by Mitch Kokai
Senior Political Analyst, John Locke Foundation
Lawmakers on Capitol Hill are gearing up for a political showdown over raising the country’s $31.4 trillion borrowing limit this coming spring or summer after punting the issue to a new Congress.
Republicans will take control of the House in January, setting up a clash that could have major economic implications.
Some Democrats had urged their leadership to take action to raise the borrowing limit during the lame-duck session of Congress while they had unified control of both chambers. But congressional leaders ran out of time and abandoned the idea, focusing instead on negotiating a sprawling government funding package. Republicans in both the House and the Senate are expected to use the nation’s debt ceiling as leverage to push policy changes, setting off a standoff that could shake global markets.
“We had a resolution in the last Congress, any increase in the debt ceiling would have to be accompanied by some manner of fiscal controls,” Sen. Ron Johnson (R-WI) said to reporters after leading a GOP conference meeting in mid-December in an effort to persuade fellow Republicans to hone in on fiscal conservatism.
Johnson, who often portrays himself as a deficit hawk, said he made the case for needing to rein in government spending and told reporters his fight has only just begun, foreshadowing the looming debt ceiling showdown to come in the new year.
“We talked about using that moment of leverage in the way that it was meant to be used. The whole purpose of the debt ceiling was, should you have to increase it because of deficit spending, that you’d be forced to do some kind of fiscal controls in exchange for what most people don’t want to vote for,” he said.