Mnuchin says hurricane relief aid should be tied to raising debt limit

Treasury Secretary Steven Mnuchin said Sunday that Congress should combine an initial package of relief for victims of Harvey with an increase in the nation’s debt limit, saying lawmakers need to “put politics aside” to ensure that those trying to recover from the storm get the help they need.

“The president and I believe that it should be tied to the Harvey funding,” Mnuchin said of the debt-limit increase on “Fox News Sunday.” He said it should be a so-called clean increase in the borrowing authority that doesn’t have any other provisions tied to it. “We need to help people in Texas and we need to get that done.”

President Donald Trump visited storm-ravaged Texas Saturday saying he hopes for a “quick process” getting Congress to approve almost $8 billion in initial Harvey relief. Trump will meet with congressional leaders of both parties this week to discuss the aid package, Mnuchin said.

In a letter to House Speaker Paul Ryan, R-Wis., requesting the storm aid, White House Budget Director Mick Mulvaney Friday stopped short of explicitly asking for the aid to be tied to raising the debt ceiling. But the letter makes it clear that the emergency spending would accelerate the timetable for raising the limit and conveys the idea that failure to pay obligations could imperil essential government services when residents in Texas need the help.

The White House disaster aid request includes $7.4 billion for the Federal Emergency Management Agency and $450 million for the Small Business Administration. The request is intended primarily to cover funding demands through the end of the federal fiscal year on Sept. 30.

House Republican leaders plan to vote this week on Trump’s request in initial disaster relief funding but they don’t plan to include a debt-limit increase in the legislation, two GOP congressional aides said before Mulvaney’s letter was sent.

The efforts to link the two measures are intended to avoid a standoff over the issue that could rattle financial markets. Mnuchin has repeatedly said that it’s “critical” that Congress raise the debt ceiling by Sept. 29.

Trump has threatened to shut down the government if Congress does not include his request for $1.6 billion for a wall on the U.S.-Mexico border in a stopgap bill needed to keep the government open past Sept. 30. Asked about funding for the wall, Mnuchin said the president’s top priority was the Harvey aid.

Texas Governor Greg Abbott said on CNN’s “State of the Union” that $120 billion was needed to respond to Hurricane Katrina and he expects damage from Harvey will be greater.