Hatch accuses Treasury Sec. Lew of creating 'needless panic' on debt limit By Peter Schroeder - 10-04-13 03:4

Hatch accuses Treasury Sec. Lew of creating 'needless panic' on debt limit
By Peter Schroeder - 10-04-13 03:46 PM ET

Sen. Orrin Hatch (R-Utah) is accusing Treasury Secretary Jack Lew of creating "needless panic" in financial markets over the debt ceiling.

In a letter sent to Lew Friday, Hatch argued that the Treasury's pronouncements about the dangers of default were "irresponsible" and are spooking markets.

"It is irresponsible for high-ranking government officials to stoke fear into the marketplace and sentiments of the American people based on personal conjectures, when you know that Republicans are willing to work with you to reach a reasonable resolution," he wrote.

With the Oct. 17 debt limit deadline approaching, the Obama administration has become increasingly vocal about the dangers that could come if Congress refuses to increase the $16.7 trillion borrowing cap. And they enjoy support from much of the financial community, which has also sought to highlight concerns about a debt default.

The Securities Industry and Financial Markets Association warned Friday that a default would be "unacceptable and will have an incredibly negative effect on markets and on Americans."

The Treasury Department released a report Thursday that warned that a debt default could lead to financial chaos and drive the nation into a recession worse than the one caused by the 2008 financial meltdown. And in an interview with CNBC Wednesday, President Obama said Wall Street "should be worried" about the debt limit fight. The president also met with the heads of major financial institutions earlier this week to discuss the shutdown and debt limit debates.

Hatch said he agreed that default is not an option but accused the president of being the one driving fear over a default, as opposed to congressional Republicans. GOP lawmakers are lining up a number of concessions in exchange for an increase to the borrowing limit, while Obama has said he would not negotiate over a boost to the borrowing cap, calling it too important to be used for haggling.

But Hatch argued that unflinching stance was unrealistic, noting that previous debt limit boosts have been paired with other fiscal provisions. The White House has acknowledged that fact, but also contended that prior debt limit fights never reached the heights pushed by current House Republicans.

Hatch said he was committed to working to find a resolution to the debt limit fight but added that "questioning sentiments of Americans and suggesting that they are too calm is irresponsible behavior."