WASHINGTON (Reuters) – U.S. President-elect Donald Trump said on Sunday that the 2023 debt ceiling extension agreed by then-House Speaker Kevin McCarthy and President Joe Biden would “be one of the dumbest political decisions in years.” one” .
Under the 2023 budget agreement, Congress suspended the debt ceiling until January 1, 2025.
Trump said in an article published in “Truth Social” that “the extension of the debt ceiling by the former Speaker of the House, a good man and a friend of mine… will be regarded as one of the stupidest political decisions in years. “
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He added, “Democrats must be forced to vote on this dangerous issue now, during the Biden administration, not in June. They should be held accountable for this potential disaster, not the Republicans!”
However, Republicans will take control of both chambers of Congress starting Jan. 3, and at least some of the party’s lawmakers must agree to increase or eliminate the debt limit before it becomes law.
If the debt ceiling is not raised in 2023, the United States will experience a historic default on debt payments, which will disrupt global financial markets.
A debt default could also lead to a downgrade of the U.S. credit rating, raising borrowing costs for businesses and individuals.
At the time, several far-right Republicans in the House had pushed for further cuts in federal spending as a condition for raising the debt ceiling, beyond what was negotiated.
About a week before the U.S. government’s discretionary funding expires on Dec. 20, Trump, encouraged by billionaire Elon Musk, has called for the debt ceiling to be lifted or extended, possibly until the end of his presidential term in 2029 .
The idea was tacked on to extending government funding through March but was quickly rejected by a coalition of House Democrats and far-right Republicans, many of whom represent districts in Trump-leaning states.
Subsequently, a government funding bill without a debt limit provision was enacted into law.
Next month, newly elected Republicans in Congress are expected to insist on deep cuts in federal spending as a condition of raising the nation’s borrowing limit.
Earlier this month, Democrats argued that Trump’s calls for an immediate increase or elimination of the debt ceiling were driven by his desire to make room for a new round of tax cuts that could lower revenues and thereby increase debt.
Due to the level of federal spending and decades of tax cuts enacted, the national debt is currently about $36.1 trillion.
(Reporting by Jasper Ward and Richard Cowan; Editing by Don Durfee and Chris Reese)
