Pelosi: No Debt Increase Until Spending Limits Are Raised

Pelosi: No debt increase until spending limits are raised

WASHINGTON (AP) — Speaker Nancy Pelosi said Thursday that the Democratic-controlled House won't pass must-do legislation to increase the government's borrowing cap until the Trump administration agrees to boost spending limits on domestic programs.

The California Democrat said she'll agree to increase the so-called debt ceiling, which is needed to avoid a market-cratering default on U.S. government obligations this fall. But she says she'll do so only after President Donald Trump agrees to lift tight "caps" that threaten both the Pentagon and domestic agencies with sweeping budget cuts.

"When we lift the caps then we can talk about lifting the debt ceiling — that would have to come second or simultaneous, but not before lifting the caps," Pelosi told reporters.

Treasury Secretary Steven Mnuchin, who is leading negotiations for the administration instead of hard-liners like acting White House budget chief Russell Vought, shares Pelosi's sentiments, though his top priority is to increase the borrowing cap.

"If we reach a caps deal, the debt ceiling has to be included," Mnuchin said Wednesday.

Vought, for years an activist with the conservative Heritage Foundation's policy advocacy arm, took a more aggressive tack after Pelosi's announcement.

"Democrats' threat to hold the debt limit hostage to trillions in new spending is reckless and irresponsible, risking America's full faith and credit," Vought wrote on Twitter.

Her remarks came as bipartisan negotiations to increase the spending limits have sputtered, though Senate Majority Leader Mitch McConnell, R-Ky., is eager for an agreement. A pair of negotiating sessions last month generated some initial optimism but there hasn't been any visible progress since.

"We were making some progress but then they kind of backed away from it," Pelosi said.

At issue are two separate needs that are often linked together.

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