WASHINGTON �� Treasury Secretary Steven Mnuchin said he's "comfortable" that the government can be funded until the start of September but urged Congress to lift the national debt cap as soon as possible to avoid agitating markets.
The administration has "backup plans" if Congress doesn't approve a debt-ceiling increase before its five-week recess through Sept. 5, Mnuchin said Monday at a hearing before the House Appropriations Committee. "The sooner we do it the better. There are events in the world that could make it more difficult to borrow."
While the government hit its borrowing limit in March, it's been relying on special accounting maneuvers to stay under the current debt ceiling of nearly $20 trillion. Only Congress can increase the legal limit on how much the government can borrow. Not lifting that cap could put the U.S. at risk of defaulting on its financial obligations.
Raising the cap has been contentious in recent years as members of Congress sought to use it for leverage on spending controls. Mnuchin repeated his call for a vote on raising the cap with no strings attached. Congress may want a debt-increase bill with conditions.
The U.S. budget gap increased to $88.4 billion in May, from $53 billion a year earlier, according to Treasury Department figures released Monday. Revenue rose 7 percent while spending was up 19 percent, the data showed.
Tax revenue this fiscal year has grown by 3 percent less than the Congressional Budget Office had projected. Mnuchin has said anticipated tax cuts the Trump administration has promised this year may help explain the revenue slowdown, but that he's not concerned.
President Donald Trump's administration has promised to cut taxes for individuals and businesses this year.
