Timothy Geithner: End debt ceiling for good?

November 30, 2012

POLITICO

JOSEPH J. SCHATZ

Nobody on Capitol Hill likes raising the debt ceiling.

But now Treasury Secretary Timothy Geithner wants to end the practice.

Forever. 

GOP aides say that in talks with congressional leaders on Capitol Hill on Thursday, Geithner proposed a “permanent” increase in the debt ceiling — meaning changing the law so that Congress no longer has to approve an increase in the statutory borrowing cap, which has been in place since 1917.

He hinted at it in an interview with Bloomberg News a few weeks ago. But the fact that Geithner is proposing giving the administration such authority behind the scenes adds a new dimension to the idea.

The need for a separate vote on spending, and then the borrowing cap, is somewhat unique to the United States. “The United States is unusual among the countries we reviewed in using the authorization of additional borrowing authority as an occasion to draw attention to past fiscal policy decision,” the Government Accountability Office noted in a 2011 report.

Under Geithner’s plan, according to a senior Senate GOP aide, the president would have the authority to unilaterally raise the debt ceiling at any time. Congress could pass a resolution of disapproval to stop the increase, but it would require a two-thirds vote of both chambers to pass and could still be vetoed.

Lawmakers in both parties have long used the debt ceiling as leverage for other demands. Senate centrists used it early in President Barack Obama’s presidency to force the creation of a debt commission.

But in 2011, Republicans took the practice to new lengths, demanding major spending cuts in return for a debt-ceiling increase, and forcing a stalemate that took the government within days of a first-ever default.

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