Mnuchin: Tie Harvey funding to debt ceiling

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Trump's attacks on members of his own party and his failure to denounce white supremacists at a violent protest in Charlottesville, Virginia, this month, has raised questions over the president's ability to build consensus on the debt limit, one bank lobbyist said. "I feel a lot of Houston is drying out, and I don't want them to forget about us", she said.

Although Sen. Ted Cruz (R-Texas) said on ABC News' "This Week" that "the president speaks in ways I wouldn't speak", he said it "is his prerogative".

Senator Roy Blunt, a junior member of the Senate's Republican leadership, said it was possible lawmakers could tie legislation raising the USA debt ceiling - an unpopular step among some Republican conservatives - to legislation providing financial aid for recovery from Harvey.

During an interview on "Fox News Sunday", Mnuchin was asked whether he can guarantee that disaster aid for Harvey would not be tied to a bill to raise the debt limit. On Sunday, he said a higher debt limit should be linked to Hurricane Harvey relief funding. In fact, the nation's debt limit has already technically been reached but the Treasury Department is using numerous accounting measures to pay the bills.

"We need to put politics aside and we're going to be urging Congress to get both of those things done as quickly as they can", Mnuchin said. In the wake of Hurricane Harvey, however, Mnuchin told CNBC on Thursday that the deadline could move up a few days.

S&P warned last week that failure by Congress to lift the debt ceiling would likely be "more catastrophic" than the collapse of Lehman Brothers in 2008 that led to the global financial crisis.

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Trump's aid request would add $7.4 billion to dwindling Federal Emergency Management Agency disaster aid coffers and $450 million to finance disaster loans for small businesses.

The Republican-controlled Congress - which includes fiscal conservatives adverse to more spending or borrowing - must upon returning also promptly agree on another key issue, passing a spending resolution to keep the federal government fully operational past September 30.

Texas Governor Greg Abbott said on CNN's "State of the Union" that $120 billion was needed to respond to Hurricane Katrina and he expects damage from Harvey will be greater.

"This is where we come to the part where Congress plays a role".

Mnuchin argued that Texas will not be able to get the billions of dollars it needs unless Congress first agrees on a debt ceiling increase. "And the President has made it clear that we want a better economic deal", Mnuchin said.

"That's one way to do it", Blunt said on NBC's "Meet the Press".

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