In recent years, both the Bush and Obama administrations have sought increases in the debt limit, a move that is necessary for the Treasury Department to borrow money and pay its bills despite a growing national deficit. In January, the limit was raised by $1.9 billion to its current level, $14.3 billion.
Observers say global markets would be rattled and the federal government would face a spike in the interest it pays on its obligations if the limit isn't increased.
"Traditionally, the majority party is supposed to put up the votes to do that," Sherman said. "But those who wish to get 'tea party' support may vote against increasing debt limit. There might even be an attempt to put in poison pills to make it impossible for the president to sign it."
Incoming House Majority Leader John Boehner (R-Ohio) has said his party will seek significant spending cuts before agreeing to raise the limit. Sherman said he worried about a government shutdown if negotiations falter.
"Unless there is a real demand for compromise from voters of the country, Washington will be looking as dysfunctional as Sacramento did a few months ago," he said.
Sherman joins foes of trade imbalance
At least one legislative priority for Rep. Brad Sherman (D-Sherman Oaks) might get better play with Republican control of the House of Representatives than it did when his own party held the majority.
Sherman, who is on the House Foreign Affairs Committee, has proposed China be stripped of its status as a most favored nation. The status offers designated countries lower tariffs and barriers to trade with the U.S. than it would otherwise face.
Sherman has criticized China for encouraging the gaping trade imbalance between the two nations and shaping monetary policy to make matters more lopsided.
The legislation may remain a long shot, but Sherman said the change of leadership might give it more serious consideration.