By Russell Berman and Ben Geman

The Hill

June 13, 2011

Former Senate Budget Committee Republican staff director Steve Bell, now with the Bipartisan Policy Center, said that Cantor’s remarks demonstrate that the leadership is trying to move the caucus away from an approach, advocated by Sen. Pat Toomey (R-Pa.), that would allow the debt ceiling to be breached.

Under Toomey’s approach, other payments would be prioritized below payments to bondholders, thereby avoiding a technical default on the debt.

Bell said that most economists and Wall Street understand that passing Aug. 2 without congressional action would mean Treasury would have to force the closure of most government buildings and suspension of most federal government workers, even if bond payments are made.

Read the full article here

---

Economic Policy Project