ICYMI: Powell Joins Growing Group of Experts Urging House Republicans to Act Responsibly

WASHINGTON, DC — As House Republicans continue to hold the debt ceiling hostage in their quest to cut Social Security and Medicare, they have increasingly floated the idea of "payment prioritization" as a potential way to stave off a full default. But over the years, Treasury has made clear that payment prioritization is reckless and unworkable, as Department systems are set up to pay bills as they are due. Yesterday, Federal Reserve Chairman Jerome Powell joined the chorus of experts warning House Republicans against brinkmanship, underscoring that the only way to avoid a catastrophic default is to raise the debt ceiling.

Here's what experts say about payment prioritization:

1. Federal Reserve Chair Jerome Powell: ""There's only one way forward here, and that is for Congress to raise the debt ceiling so that the United States government can pay all of its obligations when due. And any deviations from that path would be highly risky. No one should assume that the Fed can protect the economy from the consequences of failing to act in a timely manner."
2. Treasury Secretary Janet Yellen: "A failure on the part of the United States to meet any obligation, whether it's the debt holders, members of our military, or to Social Security recipients, is effectively a default... Treasury systems have all been built to pay our bills, to pay all of our bills when they are due and on time and not to prioritize one form of spending over another."
3. Former Treasury Secretary Jack Lew: "The notion is intellectually bankrupt."
4. Former Treasury Secretary Steve Mnuchin: "I think that doesn't make sense. The government should honor all of its obligation and the debt limit should be raised."
5. Former Treasury Secretary Tim Geithner: "The idea of ‘prioritization' has been rejected by every President and Secretary of the Treasury who have considered it. It is unwise, unworkable, unacceptably risky and unfair to the American people. There is no alternative to enactment of a timely increase in the debt limit."
6. Former Treasury public affairs official John Rizzo: "This idea of prioritizing payments is just default by another name. And so hopefully, House Republicans move off this proposal, because it would be a disaster for the American economy, and it would lead the United States into default, which we cannot risk."

"Experts of both parties have made clear time and again: payment prioritization is just default by another name," said Congressman Brendan Boyle, Ranking Member of the House Budget Committee. "The debt limit needs to be raised, full stop. Payment prioritization is an untested and dangerous distraction and is no replacement for responsibly raising the debt limit and avoiding economic catastrophe."

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