The Trump administration would support replacing the federal debt ceiling with a bipartisan alternative, Treasury Secretary Steven Mnuchin said Tuesday.
“We are very open to bipartisan solutions to figure out something as an alternative to the current system that I think many of us would agree doesn’t work well,” Mnuchin said at a Senate hearing.
Federal law prevents the Treasury from issuing debt above a certain limit. When that limit is reached, Congress must pass legislation authorizing the Treasury to issue more debt in order for it to continue paying the government’s incoming bills.
Currently, the government is up against the ceiling. The Treasury is moving around accounts in order to pay bills as they come due. Mnuchin said Tuesday he will run out of options sometime in February.
At Tuesday’s hearing, Sen. Brian Schatz, D-Hi., suggested Vice President Mike Pence had expressed an interest in reforming the debt ceiling.
Traditionally, the party out of power has required reform measures attached to legislation raising the debt ceiling. Fiscal conservative members of Congress have said that increases should come with measures for lowering federal spending.
Like Treasury secretaries before him, though, Mnuchin has called on Congress to raise the limit quickly.
His predecessor, Obama Treasury Secretary Jack Lew, called for getting rid of the debt ceiling as he left office.
