House Republicans passed a bill to increase the debt ceiling and rein in federal spending in a victory for House Speaker Kevin McCarthy.
Summary
House Republicans passed a bill to increase the debt ceiling and rein in federal spending in a victory for House Speaker Kevin McCarthy.
- The bill passed by a narrow 217-215 margin after a series of last-minute tweaks to the bill to appease some of the rival factions in the House Republican Conference, which McCarthy has reportedly nicknamed “the Five Families.
- The legislative package, McCarthy’s opening offer to President Joe Biden in debt limit negotiations, would raise the federal government’s debt ceiling by $1.5 trillion coupled with significant spending cuts.
- Both Biden and Senate Majority Leader Chuck Schumer have insisted for months on a so-called “clean” debt ceiling increase without spending cuts included. The House GOP plan is designed to force Democrats to the negotiating table to avoid a fiscal crisis.
- Unspent Covid-19 emergency funds that have already been authorized by Congress would be clawed back under the GOP proposal, which would lower deficits by $4.8 trillion over the next decade but would not lead to a balanced budget.
- Additionally, The GOP bill would revoke Biden’s plan to transfer $20,000 student debt obligations to the taxpayer, repeal significant chunks of the Inflation Reduction Act, tighten work requirements for federal programs, and boost the production of oil, gas, and coal.
- Four Republicans voted against the bill, known as the Limit, Save Grow Act, along with every Democrat. Rep. Matt Gaetz (R-FL) asked for a concession on work requirements, received it, then voted “no” anyway. Rep. Tim Burchett (R-TN) expressed concern about the national debt, while Reps. Ken Buck (R-CO) and Andy Biggs (R-AZ) also voted against the measure.
- The New York Times noted if the US hits the debt limit in June, the government will not have the money to pay its bills. A default on US debt obligations could lead to an international financial crisis and plunge the US into a recession.
- The Washington Post reported many of the GOP spending cuts are in effect just caps on federal spending or the restoration of fiscal year 2022 spending levels for key agencies while keeping the growth of future spending to 1% over the next decade.
- Politico chronicled how McCarthy got the right flank of his caucus on board with his debt limit plan. The Speaker involved conservatives in the process from the start, and the final product “reflected their goals: stricter work requirements for Medicaid and food stamps, Covid aid clawbacks and across-the-board spending cuts to discretionary spending.”
- “We cannot sit back and ignore the problem like the president has,” said McCarthy according to Breitbart News. “We want to sit down. We want to work together, and that’s exactly what this bill does, to put us in an ability to negotiate.”
- House Republican leaders argue “the ball is now in Biden’s court” now that Republicans have passed their proposal. “We are the only chamber that has done our job,” Rep. Elise Stefanik (R-NY) told Fox News. “[Senate Majority Leader Chuck Schumer] needs to get the negotiating table, as does President Joe Biden.”
- The Wall Street Journal reported on the impact of even a temporary disruption in the federal government’s debt payments, which “could wreak havoc on multitrillion-dollar markets that banks and companies rely on to fund their daily operations.”
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© Dominic Moore, 2023
