WASHINGTON -- As Congress readied for a new battle over raising the debt limit, Sen. Barbara Boxer announced legislation that would prevent lawmakers from being paid if they did not increase the nation’s borrowing authority.
“It is an American value to pay your bills. It’s also an American value to do your job,” Boxer (D-Calif.) told reporters Wednesday. “If we as members of Congress refuse to pay the bills we have incurred, we should not be paid our salaries.”
Boxer announced the legislation along with the lead House sponsor, Rep. Jim McDermott (D-Wash.). It is modeled on legislation enacted in January that denied salaries to members of Congress if their chamber did not pass an annual budget.
The proposed Pay Your Bills or Lose Your Pay Act, which probably has little chance of passage, is part of the political maneuvering over the contentious debt limit debate.
A partisan standoff over raising the limit in the summer of 2011 -- resolved at the last minute -- led Standard & Poor’s to downgrade the U.S. AAA credit rating for the first time.
The legislation from Boxer and McDermott came after the Congressional Budget Office estimated Tuesday that the $16.7-trillion debt limit would not need to be raised until October or November as the Treasury Department juggles the nation’s finances to prevent a default.
Treasury Secretary Jacob J. Lew told Congress last month that the debt limit would not need to be raised until after Labor Day, but urged lawmakers to “act sooner rather than later to protect America’s good credit” and “avoid potentially catastrophic consequences.”
The U.S. technically reached its debt limit on May 19, but accounting maneuvers by the Treasury will help allow the federal government to continue to pay its bills for several weeks.
In addition, improved economic growth, increased tax revenue and a nearly $60-billion dividend payment to the government by taxpayer-owned Fannie Mae will help delay the date by which the debt limit needs to be raised.
House Speaker John Boehner (R-Ohio) has insisted any debt limit increase must be offset by new spending cuts on top of the ongoing automatic reductions that are part of so-called sequestration.
“I believe that if we’re going to increase the debt limit, there ought to be cuts and reforms in place that are greater than the increase in the debt limit,” Boehner said in an interview on ABC’s “Good Morning America” on Tuesday.
“Our goal here is not to default,” he said. “Our goal here is to get ourselves on a sound fiscal path.”
Republicans also have talked about tying a debt limit increase to other policy initiatives, such as an overhaul of the tax code.
McDermott said lawmakers simply should raise the debt limit because it is needed to pay for spending already authorized by Congress.
“We are not a nation of deadbeats and delinquents,” he said.
Boxer referred to the 2011 credit downgrade, which the Bipartisan Policy Center has estimated will cost the U.S. $18.9 billion in increased borrowing costs over the next decade.
The brinkmanship on the issue also caused financial markets to tumble.
“We’re at a critical moment in our economic recovery...but playing politics with the debt ceiling will hurt it all,” Boxer said. “Our economy cannot take any more self-inflicted wounds.”