U.S. gov't touches debt limit amid standoff between Republicans and Democrats

By David Morgan WASHINGTON (Reuters) - The U.S. government was due to hit its $31.4 trillion borrowing limit on Thursday, amid a standoff between the

Republican-controlled House of Representatives and President Joe Biden's Democrats that could lead to a fiscal crisis in a few months. Republicans, with a newly won House

majority, aim to use the congressionally mandated federal debt ceiling to exact spending cuts from Biden and the Democratic-led Senate. Thursday's deadline will have little

immediate effect, because Treasury officials are prepared to begin employing emergency cash management measures to stave off default. More serious risks will emerge closer to

June, when the government approaches the so-called X date, beyond which the Treasury would run out of emergency maneuvers. Ahead of that deadline, there was no sign that

either side was willing to bend. "It is something that should be done without conditions. We should not be negotiating around it. It is the basic duty of Congress to get

that done," White House Press Secretary Karine Jean-Pierre told reporters. Republicans are instead pursuing a "debt prioritization" plan that would seek to avert default by

urging the Treasury to prioritize debt payments, and possibly other priorities such as Social Security and Medicare, should the limit be breached during negotiations. Republicans

hope to complete the legislation by the end of March.