Harry Reid: 'Clean' Debt Extension Vote Could Spook Markets
WASHINGTON -- The House GOP's plan to hold a vote on a clean extension of the debt ceiling -- which is expected to fail without Republican support -- will send "a terrible message to the international community," Senate Majority Leader Harry Reid said Tuesday.
"We're trying to do something that the international community sees as responsible in addressing the problems that we have with the debt," Reid told reporters. "I can't think of a way that is much more irresponsible than bringing up a debt limit extension just to show it can't pass."
House Republicans announced Tuesday morning they would hold a vote next week on a bill to raise the debt ceiling without other measures to bring down the overall debt. The bill is certain to fail: House GOP Whip Kevin McCarthy (R-Calif.) has said that not a single House Republican would support a clean extension.
Some Democrats may support the bill, which would authorize the Treasury to take on more debt without additional spending cuts and long-term deficit reduction plans. Led by Rep. Peter Welch (D-Vt.), 114 Democrats signed onto a call for a clean extension of the debt ceiling to avoid putting markets at risk.
Welch said he will likely vote for the bill next week, but he will not encourage his colleagues to support the bill. He said the House Republican effort is likely to "play into concerns" about political gridlock over the budget, which he said were part of an April announcement by ratings agency Standard and Poor's that it would downgrade the government's credit rating if Congress could not find consensus on dealing with the national debt.
"This is not a serious proposal with any serious purpose," Welch told HuffPost. "This is a complete political maneuver that's not intended to address the challenge of paying our bills."
He said the fact that the bill will be considered on suspension, requiring support from two-thirds of the chamber for passage, proves that the House Republicans are using the vote as a "political maneuver."
Rep. Gary Ackerman (D-N.Y.), a member of the House Financial Services Committee, told HuffPost he saw the GOP plan as proof of Republicans' "market-be-damned attitude."
"They're willing to put the reputation and financial integrity of the United States at risk," he said. "They're a group of marauding gangsters looking for someone to lead their party. They're taking oaths of purity and they think this is part of the process."
Ackerman said the markets are probably smart enough to see the vote as a stunt, but that it could still be damaging.
"Anything that casts further doubt on the stability of our very fragile financial condition right now is certainly not helpful," he said.
Still, the Treasury will be watching to see if the vote has any effect on the markets, an administration official confirmed to HuffPost, calling it "theatrics" from House Republicans.
The White House has called repeatedly for Congress to raise the debt ceiling, even after President Barack Obama said the debt limit increase would likely be paired with spending cuts. Treasury Secretary Tim Geithner warned Congress that the government would begin to default on its debts by Aug. 2 if Congress does not authorize it to take on additional debt.
Democrats are hypocritical to demand a clean debt ceiling extension and then decry Republicans for holding a vote on one, countered Brad Dayspring, a spokesman for House Republican Majority Leader Eric Cantor.
“If Senator Reid is angry, he should call up Secretary Geithner and the 110+ House Democrats who have demanded a vote on the clean debt extension and express his displeasure," Dayspring said in an email. "The phone number at the Department of Treasury is (202) 622-2000.â€
Mike McAuliff contributed reporting.
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First Posted: 05/24/11 05:28 PM ET Updated: 07/24/11 06:12 AM ET