- Congress has until October 18 to increase how much the government can borrow.
- The US could plunge into a financial crisis if lawmakers don't raise the debt ceiling in time.
- But Congress remains divided, and Democrats are getting impatient over their leaders' strategy.
Cracks are starting to form among rank-and-file Democrats as Congress plays a game of chicken over raising the federal government's legal borrowing limit.
They're getting impatient with their leaders' strategy to prevent the US from defaulting on its debt obligations in less than two weeks as Republicans hold firm in their blockade.
Senate Majority Leader Chuck Schumer has pushed repeatedly for a bipartisan vote, arguing that both parties have a responsibility to repay a debt that includes nearly $8 trillion incurred during Donald Trump's presidency. But for nearly three months, Senate Minority Leader Mitch McConnell has said Republicans won't vote with Democrats to raise the legal limit the US can borrow to pay back its bills, and GOP lawmakers have fallen in line.
Congress has until October 18 to act to raise the debt ceiling and stave off catastrophic financial repercussions that could ripple down to older Americans and low-income earners who use government-backed services.
A Senate Democratic aide who spoke on condition of anonymity to speak candidly told Insider that many members had reached their "breaking point" over the GOP standing in their way of increasing the borrowing cap.
Several are pushing for a more controversial option: blowing a hole in the Senate filibuster's 60-vote threshold to pass a debt-ceiling bill.
Republicans have twice blocked measures to raise the current debt ceiling, for the most part saying there's nothing Democrats can offer them to change their minds.
"There could be no better set of facts to illustrate how the filibuster hinders bipartisanship and allows the minority to go scorched-earth than this example," the Democratic aide said.
Sen. Chris Van Hollen, a Democrat of Maryland, also floated the filibuster option, saying, "We've got to act and we've got to act right now."
Bypassing the filibuster would allow Democrats to pass a bill with only a simple majority, which could include a tiebreaking vote by Vice President Kamala Harris. That would allow them to lift the debt ceiling without GOP help.
"You could create a one-time exception to save the economy from catastrophe," Van Hollen told Insider on Tuesday in the Senate hallways.
Throughout the day, the hallways of Congress were busier than usual as reporters crowded around exasperated senators to ask about whether any compromise could be reached on the debt ceiling. Senators darted in and out of caucus lunches that yielded no compromise.
Some Republicans are getting uneasy too
"I wouldn't say I'm not hearing any unease," Sen. Shelley Moore Capito, a Republican of West Virginia, told Insider at the Capitol on Tuesday. "I don't think any of us want to default on this, and we don't think it's a toy to be played with."
The threat of fiscal calamity has some senators searching desperately for a backup plan. Sen. Lisa Murkowski, a moderate Republican of Alaska, appeared torn over whether she'd vote Wednesday to let the Senate move ahead on suspending the debt limit. She told reporters she was "still looking" for a compromise on the debt ceiling.
"We have got to get through Wednesday," she said. "I want to make sure we are doing everything that we can to not send us into a situation of default, and I don't even want to get close."
Treasury Secretary Janet Yellen has warned that if Congress fails to act by October 18, the US could fail to make its debt payments. If the US defaults, Americans could face delays receiving Social Security checks, and federal unemployment benefits along with government health-insurance programs for low-income earners could be cut.
President Joe Biden has said he can't guarantee the US won't default on its debt. He has preemptively cast blame on GOP leadership.
"That's up to Mitch McConnell," Biden said Monday.
Analysts have also warned of soaring interest rates, which could jack up mortgage rates, car loans, and credit-card payments.
Spearheaded by McConnell, Republicans are betting their refusal to work across the aisle on lifting the debt ceiling would force Democrats to do it unilaterally through the process known as budget reconciliation. That party-line maneuver allows the approval of certain bills with only a simple majority.
But experts say it could take at least two weeks for Democrats to pull it off, should they go that route.
The GOP sees two political advantages in its brinkmanship: a debt-ceiling hike backed only by Democrats could expose Democrats to politically uncomfortable votes. It would also force Democrats to determine the new debt limit, a specific number the GOP could weaponize in next year's midterms.
At least one small area of wiggle room emerged Tuesday as lawmakers searched for a way out of the impending chaos. Republicans said they could agree to a shortened reconciliation process that would still force Democrats to vote on the measure by themselves.
"The Democrats need to begin the process of reconciliation, and perhaps negotiate a timeframe for that to occur," Sen. Mitt Romney, a Republican of Utah, told Insider. He cited examples like setting agreements with Republicans over shortening the debate time allowed over the bill or agreeing upon how many amendments senators could present.
Murkowski said shortening the timeframe for reconciliation was "a possibility."
"What we have got to figure out is to ensure we don't come up against this limit and cause the anxiety that everyone is justifiably afraid of," she said.
Moody's Investors Service predicted on Tuesday that Democrats would end up using reconciliation given that Republicans were resolved to vote against hiking the debt limit.
At least one Democrat has indicated openness to a party-line debt-limit hike: Sen. Joe Manchin, a conservative Democrat from West Virginia. He told CNN on Monday that Democrats should not "rule out anything" including reconciliation because "we just can't let the debt ceiling lapse."
'We've got to govern this country'
Other Senate Democrats are trying to find a way out of the standoff. Sen. Tim Kaine, a Democrat of Virginia, told reporters Tuesday that Democrats had several options but indicated reconciliation wasn't one of them.
He did not specify what the alternatives could be.
"This isn't about who's to blame and who wins," Kaine told Insider. "This is about, 'We've got to govern this country,' that's what this is about. The majority party has to govern the country."
"All I'm going to say is that we need to do this now," Kaine said, adding that he believed Democrats should've included the measure in their $3.5 trillion budget plan back in August meant to strengthen the social safety net and addressing the climate crisis.
Many Republicans said they were holding firm to force Democrats' hand on the debt ceiling. Sen. Richard Shelby, a Republican of Alabama who is retiring after 2022, said he didn't even think the US was as close to defaulting as Treasury officials had indicated.
"I think they've got more weeks than they say," he told reporters, citing his decades working on banking issues in Congress.
Capito, who'd said there had been unease about the strategy, maintained that Democrats had a "clear path" for solving the problem. "If there were no other avenues, I think we'd have a different conversation," she told Insider.
Asked by Insider whether there were 10 Republican votes that would be needed for a debt-ceiling increase, Sen. Cynthia Lummis, Republican of Wyoming, said, "No I don't," with a laugh.
"There are no Republicans that are going to help," Sen. Richard Burr, a Republican of North Carolina who is retiring after his term ends in 2022, told Insider.
On Monday, Sen. Susan Collins, a Republican from Maine, told reporters that Democrats could strike a debt-limit deal if they agreed to abandon President Joe Biden's $3.5 trillion social and climate spending plan. Democrats immediately rejected the idea as a nonstarter.
"No one wants to see the federal government default, but they should be putting a number on it," she told Insider on Tuesday. When Insider tried to follow up later in the day with the Maine Republican on the debt limit, she accused the reporter of "bias."
"I've answered this 800 times, to you!" she said, pointing her index finger.