Manchin calls for deal with Republicans on debt ceiling, fiscal commission

The two parties are currently at a standoff over the debt ceiling, which threatens to upend financial markets sometime after early June, when the US may default on a payment obligation. 

Manchin, however, said he has already discussed a possible compromise with House Speaker Kevin McCarthy, whose fractious caucus has sought to extract concrete spending cuts and a balanced budget plan in exchange for any increase in the debt ceiling. 

Manchin, speaking to Fox Business in Davos, Switzerland, where he’s attending the World Economic Forum, said he wants to package a debt ceiling increase with votes to create special commissions to examine shoring up the Social Security and Medicare trust funds, as well as another intended to reduce the overall US debt. 

“We have to work together.  It has to be bipartisan and it has always been bipartisan as far as the debt ceiling,” Manchin said. “I think what we have to do is realize we have a problem, we have a debt problem.”

Manchin said he supports the Trust Act, a proposal by Senator Mitt Romney, a Utah Republican, to enlist commissions to recommend solutions to the eventual insolvency of the Medicare and Social Security trust funds. Current projections are that Social Security will not be able to pay full benefits after 2035 and Medicare after 2028, without either changes to the benefit structure or increased revenue. 

Under the Romney proposal, the recommendations of the committee would be guaranteed an up or down vote in Congress.  

Romney has also suggested creating a fiscal commission modelled after the 2010 Simpson-Bowles Commission, which couldn’t get the votes to send its $4-trillion deficit reduction plan to Congress. 

It isn’t clear whether Manchin’s proposal would go far enough for House Republicans, but the West Virginia senator said he plans to continue speaking to McCarthy.   

The White House has insisted that the debt ceiling be increased without conditions and administration officials have said they won’t negotiate on the matter. 

Manchin, a pivotal vote who last year forced Biden to whittle down his economic plan, said he believes the president would negotiate eventually. 

“I think they will, I really do,” he said. 

Treasury Secretary Janet Yellen last Friday told Congress that the $31.4 trillion debt ceiling will be reached by Thursday. After that, the Treasury can deploy special accounting measures to avert a payment default until sometime after early June, she said. BM/DM