President Barack Obama will delay asking Congress for $1.2 trillion to raise the US government’s debt ceiling to allow vacationing lawmakers time to weigh the request, officials said Friday.
But a senior White House official stressed that the decision was purely a procedural maneuver that should not spook markets and added that the Treasury would take measures to ensure the US government did not default on its debt.
The Treasury said earlier this week that the government was due to hit its debt limit of $15.2 trillion in the first week of January. Since the government would shortly be within $100 billion of that level, officials said that Obama would request an increase.
Once the president requests a debt limit increase, Congress has 15 days to oppose it.
But since lawmakers are currently on their Christmas and New Year recess, leaders of both chambers had asked for a delay of the request, White House deputy spokesman Josh Earnest said in Hawaii, where Obama is also on vacation.
“We have been asked by the bicameral leadership of Congress to delay certification in order to give both houses time to consider when votes may occur given the current congressional schedule,” Earnest said.
“The administration is in discussions with leaders in both houses to determine the best timing for submission of the certification and any subsequent votes in the two houses.”
Congress agreed on July 31 to immediately increase the national debt by $400 billion, and then raise it in subsequent stages when necessary.
An increase can only be blocked if both the House of Representatives and the Senate pass measures opposing it.
Even if Congress were to disapprove a debt limit increase, Obama has the authority to veto any motion of disapproval.
Officials did not expect any repeat of this year’s showdown between Republicans and the White House on the debt ceiling increase, which raised the prospect of the US government defaulting on its obligations for the first time.
In September, the Democratic Party-dominated Senate declined to block a $500 billion increase.
But the Republican-controlled House nevertheless passed a resolution symbolically rejecting the ceiling rise.
With fiscal rectitude looming large as the 2012 election season gets underway in earnest, the new request to hike the borrowing ceiling could sound the starting gun on a fresh political fight.
If opposition to the increase is unsuccessful, the limit to US borrowing, which has been heavily inflated by wars in Iraq and Afghanistan, will be raised to around $16.4 trillion.
That is expected to put the issue to bed until late 2012. A new rise in the debt ceiling is not expected to be needed until after the general elections in November.
The House is due back in session on January 17, while senators are due back in Washington on January 23.