Jack Lew: Debt limit increase not up for negotiation

The White House is not open to negotiating terms for the next debt ceiling increase, Treasury Secretary Jack Lew says. 

During an interview to air Sunday on CNN’s FAREED ZAKARIA GPS, Lew said top administration officials are intent on separating the debt ceiling from the broader debate over fiscal policy this year.

theobamadollar_small Jack Lew: Debt limit increase not up for negotiation

“The president has made very clear that we will not negotiate over whether or not the government should default and we will not get into a negotiation like 2011, over the debt ceiling,” Lew said. 

The messy 2011 fight, which paved the way for this year’s sequestration cuts, was too painful to repeat, Lew said. Though an eleventh-hour deal narrowly averted a government shutdown, U.S. markets – and the country’s credit rating – took a hit.

“It caused real damage to the economy.  That can never be allowed to happen again,” Lew said. “That’s one of the reasons the president said Congress has to just increase the debt limit and we have to put at ease the concerns that the United States could once again find itself in a crisis of its own.”

Congressional Republicans, however, aren’t likely to approve another increase without something in return.

Late last month, Speaker John Boehner (R-Ohio) scoffed at the idea that Congress would raise the debt limit without a conversation about the underlying issues.

“We’re spending more money than what we’re bringing in. We have to deal with this problem. And if we’re going to raise the debt limit, then we’ve got to do something about what’s causing us to spend more money than what we bring in,” Boehner said on June 20. “So guess what? We’re going to have a debate, and we’re going to have a negotiation.”

Treasury is expected to reach the debt ceiling sometime around Halloween.

This time around, Republicans are in no position to demand a ransom in exchange for a vote, Lew argued, saying “they can’t go back to where they were in 2011.” Since then, the federal government has achieved roughly $4 trillion in deficit reduction through higher taxes and spending cuts over a ten-year period, he said.

Lew said the administration is open to negotiations over the fiscal 2014 budget, which will also be the subject of intense debate this fall.

“When we say we won’t negotiate over the debt limit, that we can’t debate over whether or not the government of the United States should default for the first time in 237 years, that is a different question than are we open to a reasonable accommodation on budget policy,” he said.