Did Washington learn anything from the paralyzing debt ceiling debate of 2011?
It doesn’t look like it.
More than a year after a debt limit standoff brought the U.S. government within days of a first-ever default, the Treasury is again approaching its borrowing limit — and nobody is talking about it…
While Wall Street and the business community aren’t looking forward to the possibility that Congress will allow $600 billion in tax hikes and spending cuts at the end of the year, they consider the debt limit a bigger problem, if the brinksmanship of 2011 returns. The consequences of a default are far broader and more unpredictable, given the central role Treasury securities play in the day-to-day operations of financial markets.
But Steve Bell, a former Republican staff director on the Senate Budget Committee who is now senior director of economic policy at the Bipartisan Policy Center, notes that freshmen Republicans are unlikely to want to vote on the debt ceiling again right after the election — meaning it may not happen until February.
“Are you going to, having swallowed this castor oil the first time … do it for a second time in your first term after having said you wouldn’t?” Bell asked.