Treasury's Lew: Congress needs to pass debt limit

WASHINGTON (AP) ? Congress needs to raise the debt limit and take away the "cloud of uncertainty" about the nation's ability to pay its bills, Treasury Secretary Jack Lew said in an interview broadcast Sunday.

"The fight over the debt limit in 2011 hurt the economy, even though, in the end, we saw an extension of the debt limit. We saw confidence fall, and it hurt the economy. Congress needs to do its job. It needs to finish its work on appropriation bills. It needs to pass a debt limit," Lew said on NBC's "Meet The Press."

Senior lawmakers on Capitol Hill are trying to come up with must-do legislation to keep federal agencies running after Sept. 30 and prevent the possibility of a government shutdown. At issue is what is normally routine: a plug-the-gap measure to fund the government for a few weeks or months until a deal can be worked out on appropriations bills giving agencies their operating budgets for the full 2014 fiscal year, which begins Oct. 1.

However, some Democrats don't want to vote to continue to fund the government at new, lower levels mandated by the automatic, across-the-board spending cuts known as sequestration. And some conservatives are making a last stand against President Barack Obama's new health care law. In addition, Senate Democrats are resistant to a $20 billion spending cut wanted by many Republicans.

Lew maintains that the president won't negotiate over the debt limit.

"The mere fact of negotiating over the debt limit, after 2011, would introduce this notion that somehow there's a question about whether or not we're going to pay our bills, whether or not we're going to protect the full faith and credit of the United States," Lew said on ABC's "This Week with George Stephanopoulos." ''Well, it's not OK to default. Congress can't let us default."

"(Congress) has to stop looking for what's the last possible moment," Lew told "Fox News Sunday." ''They should get back after they take their time off in August and they should finish their work and get it done so that there's no uncertainty about America's ability to pay its bills."

Separately, Lew said no federal bailout is in the works for the city of Detroit, which recently filed for bankruptcy protection. Pressed as to why the government chose to bail out big banks, the auto industry and others, but isn't assisting the city, Lew said on CNN's "State of the Union" that the government has been giving Detroit technical advice and has made resources available to help take down blighted properties through federal programs.

But Lew said that the situation in 2009-2010 that warranted the other bailouts was "unique," and that the current problems that Detroit has with its creditors, "it's going to have to work out with its creditors."

Source: http://news.yahoo.com/treasurys-lew-congress-needs-pass-debt-limit-133914235.html

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