DOGE’s Treasury Access Could Let GOP Off The Debt Limit Hook

The news that workers with Elon Musk’s government efficiency group had obtained access to the Treasury Department’s closely-guarded payments system raised worries the government could stop paying for items the Trump administration dislikes.

But it also raised another possibility that has at least one senior Democratic senator anxious: that the White House could be preparing a workaround for raising the debt limit later this year, depriving Democrats of political leverage and putting the U.S.’ creditworthiness on the line.

“It certainly sounds to me like there’s a possibility of that going on. But that’s what we’re trying to find [out],” Sen. Ron Wyden (D-Ore.), the top-ranking Democrat on the Senate Finance Committee, told HuffPost.

A small group of Republicans have long argued that there is an alternative to simply raising the debt ceiling: In their scenario, the Treasury would simply stop borrowing money to refinance existing debt and pay off the government’s bills, and instead “prioritize” its payments. Things like payments on existing debt would be at the top of the list and other items could be paid in descending order of importance, using daily cash receipts brought in.

Most economists say even a credible chance that the U.S. would breach the limit on its federal debt — much less actually doing so — would cause global economic calamity. And Treasury officials in the past have said such an approach is unworkable, not to mention dangerous, because it could tarnish the U.S.’ sterling creditworthiness. Democrats have said prioritization is simply default by another name, because some government obligations would not be paid on time.

Prioritization would be “entirely experimental and create unacceptable risk to both domestic and global financial markets,” Alastair Fitzpayne, Treasury assistant secretary for legislative affairs, told lawmakers in 2014.

Aside from the wisdom of trying to prioritize payments, Treasury officials have also long said the department’s payment systems are unable to sort payments that finely, making the idea unworkable.

Until, possibly, now.

Dave Lebryk, a former Treasury official, retired Jan. 31 after reportedly clashing with Department of Government Efficiency personnel who sought access to the payments system, which effectively acts as the disbursing agent for trillions of dollars of government payments. Later, Treasury Secretary Scott Bessant granted DOGE workers access, though at what exact level remains unclear.

Days earlier, the Trump administration proposed freezing all federal financial aid in the form of grants and loans, but took back the order two days later. White House press secretary Karoline Leavitt then said the memo was not in effect but the plans to freeze the spending remained in place, raising eyebrows.

The possibility DOGE could use its access to the Treasury payment system to implement the freeze memo was raised after the group froze funding for several international aid programs with the U.S. Agency for International Development. Musk in a social media post said he had spent the weekend “feeding USAID into the wood chipper” and the Associated Press reported DOGE officials had sought access to the system to stop the USAID payments, citing two people familiar with the matter.

Sen. Elizabeth Warren (D-Mass.) said in a Feb. 2 letter if the reports about access to the payment systems were true, “a small group of insiders would suddenly be in a position to make decisions about whether to hold up payments to individual families or businesses — with absolutely no transparency or accountability.”

That granular level of control over payments would be necessary to implement prioritization.

“We’re still working through the terms of this, but I feel concerned about the possibility of something like that going on,” Wyden said.

The issue could come to a boil sometime in the summer, as the Treasury Department is already taking accounting moves to stay below the debt limit.

In a statement Thursday, Warren said she and Trump agree on getting rid of the debt limit. “But right now it’s in place and it’s extraordinarily dangerous for Elon Musk and his flunkies to mess with our payments system while Treasury is taking extraordinary measures to prevent a catastrophic debt default and global economic crisis,” she said.

For its part, DOGE has said its personnel have “read-only” access to the payments system. And on Thursday afternoon, the Treasury department agreed to temporarily limit DOGE’s access while a judge hears arguments in a lawsuit alleging the access violates privacy laws.

The lack of clarity over exactly what DOGE is able to do has led at least one lawmaker to be cautious about raising the alarm. Rep. Richard Neal (D-Mass.), the top-ranking Democrat on the House Ways and Means Committee, said the payments system would need to be changed to make prioritization possible.

“Republicans will grasp at any straw to avoid the responsibility of governing. They ran up with debt with their many rounds of handouts to the rich, and soon, the bill will come due. Do your job,” he said.