As the Senate on Wednesday announced a last-minute, bipartisan debt ceiling deal, the nation’s top securities industry trade group laid out the fiscal problems that could ensue if Washington lawmakers ultimately fail to resolve the fight that has brought the U.S. to the brink of default.
Former Sen. Judd Gregg (R-N.H.), CEO of the Securities Industry and Financial Markets Association (SIFMA), blamed both Republicans and President Barack Obama for their refusal to compromise and warned that the Treasury expects on Thursday to reach the limit of the extraordinary funding measures it has already taken for funding U.S. debt.
“Clearly, there is significant damage to the Republican brand in its willingness to be a party of fiscal destruction,” Gregg said in a media call, adding that Obama “has done himself considerable harm by not negotiating on this.”
The Senate budget deal, which contains almost none of the Republican efforts to hamper Obama’s health care law, would fund federal agencies at current levels through Jan. 15 and extend the nation’s borrowing authority through Feb. 7. The House has agreed to vote on the funding plan, and, if passed, it would then be sent back to the Senate for final passage, which may be completed late Wednesday or early Thursday.
Sen. Ted Cruz (R-Texas), who took a leading role in forcing a government shutdown by linking a debt deal to his attempt to defund the Affordable Care Act, said he would not attempt to block the Senate proposal. The government shutdown was in its 16th day on Wednesday.
The markets surged on the news, with the three major indexes all closing more than 1% higher.
During the debt crisis, SIFMA has been busy setting up protocols for the settlement and processing for daily transactions in Treasury securities, said Rob Toomey, SIFMA’s managing director and associate general counsel, who was on the call with Gregg.