WASHINGTON, D.C. (NBC) – Breaking news out of Washington: after weeks of legislative posturing and gridlock, there are signs there could be a deal in the works to raise the debt ceiling.
It comes after a warning from President Biden and key business leaders that failure to reach a compromise in the next 12 days could be catastrophic.
Let’s be clear, there’s no agreement yet, but Wednesday, for the first time in weeks, it appears both sides are at least talking.
After blocking the process for weeks, Senate Minority Leader Mitch McConnell (R-KY) said in a written statement late this afternoon that Republicans will agree to a short-term measure “at a fixed dollar amount to cover current spending levels into December” or an expedited reconciliation process to raise the debt ceiling so the country can continue to pay its bills.
Senator Sheldon Whitehouse (D-RI) said, “Looks like Mitch just folded and we’re going to be able to go forward the way we originally suggested as Democrats, and raise the debt limit, and we’ll be able to do that at least through December.”
The first signs of any back and forth on the issue come as President Biden sits down with some of Wall Street’s most powerful CEOs to discuss strategy and the potential consequences of failing to break through the partisan gridlock on Capitol Hill.
“It’s a meteor headed to crash into our economy,” Biden said. “We should all want to stop it.”
Analysts have predicted a government default would likely trigger a recession. More than 6 million jobs could be lost, interest rates would climb, food stamps, Social Security payments, and paychecks for those serving in the military could stop. There would likely be chaos in the markets and as much as $15 trillion in household wealth could be lost.
U.S. Securities and Exchange Commission Chair Gary Gensler told MSNBC, “If you had a home and somebody said, ‘Guess what… Your foundation is… it’s defaulted. It’s basically broken.’ The house will rumble, and the house may even collapse.”
It’s an ominous warning as lawmakers continue to search for some common, solid, ground.
There is a third option in all of this: Senate Democrats could change rules in the upper chamber allowing the debt limit to be increased by a simple majority vote. Many, including the president, have said they want to avoid that “nuclear” option.
© 2024 KOBI-TV NBC5. All rights reserved unless otherwise stated.