Tags: National Debt | steven mncuchin | debt | limit | treasury

Steven Mnuchin: 'We're Going to Get the Debt Ceiling Right'

Image: Steven Mnuchin: 'We're Going to Get the Debt Ceiling Right'
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Monday, 17 Jul 2017 10:23 PM

Treasury Secretary Steven Mnuchin vowed Monday to get it "right" as he faces his first financial crisis – a strategy to raise the debt limit by the end of September, the Washington Post reported.

Missing the deadline could lead to a market-rattling default on U.S. government debt, the Post noted.

"We're going to get the debt ceiling right," Mnuchin told the Post. "I don't think there is any question that the debt ceiling will be raised. I don't think there is anybody who intends to put the government's ability to pay its bills at risk."

But there's likely resistance on Capitol Hill to raising the debt ceiling quickly, the Post reported – and one unnamed former Treasury official told the newspaper officials are "brushing up on options in the 'crazy drawer.'"

In past administrations, Treasury officials have designed plans to prioritize payments to government bondholders so if the government runs short on cash it could, in at least a technical sense, avoid defaulting on U.S. debt, the Post noted.

The downside to that, however, is that it could lead to a spike in interest rates and a stock market crash, the Post rerouted.

Mnuchin earlier this summer told lawmakers to raise the debt ceiling in a clean vote that includes no other budget changes before they leave town.

"My preference is to get it clean," he said Monday. "My preference is to get it done, and my preference is to get it done sooner rather than later."

However, there's pushback in the White House – from Mick Mulvaney, the director of the Office of Management and Budget, a founding member of the hard-right House Freedom Caucus, the Post reported.

Mulvaney has publicly questioned Mnuchin's call for a clean vote, saying he'd prefer spending cuts or other budget changes as part of any proposal to increase the debt ceiling, the Post reported — a stance that "incensed" some White House and Treasury officials, who complained Mnuchin's credibility was being undermined.

And even though President Donald Trump told lawmakers Mnuchin was his point person on the debt limit, the White House still hasn't come out publicly in favor of a no-strings-attached vote, the Post reported.

"Mick and I have a very good relationship. I think the press made that out to be more than it is," Mnuchin told the Post.

Rep. Mark Meadows, R-NC, chairman of the Freedom Caucus, conceded Mnuchin is "certainly in the minority in the administration."

"The problem is, yes, you could get a clean debt-ceiling, but it would be 180 Democrats in the House with 40 or 50 Republicans, and that's not a good way to start," he told the Post.

Meanwhile, Mnuchin has reached out to former treasury secretary Henry Paulson Jr. and recently met with other former secretaries, including Lawrence Summers and Robert Rubin. And he has discussed the debt ceiling and other issues with Glenn Hubbard, a top Bush administration economic adviser, who came away impressed.

"He has an unassuming manner, but he should not be underestimated," Hubbard said.

For one thing, he's got an important patron: the president, the Post reported.

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Politics
Treasury Secretary Steven Mnuchin vowed Monday to get it "right" as he faces his first financial crisis – a strategy to raise the debt limit by the end of September, the Washington Post reported.
steven mncuchin, debt, limit, treasury
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2017-23-17
Monday, 17 Jul 2017 10:23 PM
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