January 8, 1996 in Nation/World

Congress Urged To Act On Debt Limit Rubin Points Out Action Needed To Prevent Default

Los Angeles Times
 

Despite a hard-fought agreement over the weekend between Republicans and President Clinton that immediately returns federal employees to work, Treasury Secretary Robert E. Rubin cautioned Sunday that action is still needed to prevent default on the government’s debts.

On a day when congressional Republicans sharply criticized Clinton’s proposal to balance the federal budget in seven years, Rubin said that lifting the debt ceiling should be resolved irrespective of the ongoing partisan fight over the budget.

Leaders of both parties agree that the debt ceiling needs to be raised, from the current $4.9 trillion to $5.5 trillion. But congressional Republicans have so far been unwilling to meet Rubin’s request for “clean” legislation that would lift the ceiling - without also forcing the president to cede ground in the balanced budget debate.

Clinton’s submission on Saturday night of his own balanced-budget proposal met a demand of congressional Republicans, paving the way for a reopening today of all government operations and services, although the big snowstorm could delay the reopening. Federal employees will remain on the job until Jan. 26 - when another spending measure would be needed.

And Rubin, whose recent accounting maneuvers to cover debt payments without a formal lifting of the ceiling drew impeachment threats from Republicans, predicted that Congress will take appropriate action to prevent a default. The treasury secretary has enraged some Republicans by borrowing from civil-service retirement accounts to avert default.

But Rubin indicated that unless Congress acts or unless he can soon identify other lawful means of temporarily making payments, the risk of default would arise around mid-February.

“We will then have a requirement again for additional (debt payments),” Rubin said, appearing on NBC’s “Meet the Press.” Rubin noted that a bipartisan group of six former treasury secretaries has written to House Speaker Newt Gingrich, R-Ga., urging that the debt ceiling be resolved apart from the balanced-budget imbroglio.

House Majority Whip Thomas DeLay, R-Texas, said flatly that Republicans will not agree to separate the lifting of the debt ceiling from their efforts to force Clinton to accept a plan to their liking.

“This president doesn’t want to balance the budget because he is a liberal Democrat (who) wants to continue more spending,” DeLay said.

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