House G.O.P. Unveils Debt Limit Bill Lifting Borrowing Cap for One Year

The proposal would impose work requirements on food stamp and Medicaid recipients and repeal funding to beef up tax enforcement.

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House G.O.P. Unveils Debt Limit Bill Lifting Borrowing Cap for One Year |

Speaker Kevin McCarthy said he would put legislation to a vote in the House next week regarding the debt ceiling.

WASHINGTON — House Republican leaders on Wednesday unveiled their proposal to lift the debt ceiling for one year in exchange for spending cuts and policy changes, as they scrounged for the votes to pass the fiscal blueprint in an effort to bring President Biden to the negotiating table.

Speaker Kevin McCarthy said in a speech on the House floor that he would put the legislation to a vote next week. He urged his conference to unite around the measure in an attempt to speed up discussions with the White House amid growing anxiety about a looming default deadline, given the United States could run out of money to pay its bills within a few months.

Even if Mr. McCarthy can get his own Republican caucus behind the bill, which is not at all guaranteed, it would be dead on arrival in the Democratic-controlled Senate. Mr. McCarthy described the effort as a way to get the White House and Democrats to engage on spending cuts at a moment when the nation’s debt has grown to about $31.4 trillion.

“Now that we’ve introduced a clear plan for responsible debt limit increase,” Mr. McCarthy said, Democrats “have no more excuse” not to negotiate.

But Mr. Biden seemed in no mood to negotiate. He lashed out at Mr. McCarthy and Republicans in a speech at a Maryland union hall that he was giving just as the House Republicans released their proposals.

The president accused the speaker and his party of seeking to slash spending in ways that will hurt Americans while protecting tax cuts for the country’s wealthiest people. Mr. Biden denounced the bill in some of his most aggressive language yet, saying it would gut critical programs and hurt the most vulnerable.

“That would mean cutting the number of people who administer Social Security and Medicare, meaning longer wait times,” he said. “Higher costs for child care, significantly higher — preschool, colleges. Higher costs for housing, especially for older Americans, people with disabilities, families and children, veterans.”

President Biden proposed a $6.8 trillion budget that sought to increase spending on the military and social programs while also reducing future budget deficits.

  • Recapturing a Centrist Identity: Biden has made curbing the budget gap one of his centerpiece promises. The move is part of a wider shift that sees the president speaking more to the concerns of the political middle.
  • Reducing Deficit: Instead of talking about hard choices and freezing spending, the president has pledged to defend popular federal programs and rely on taxing corporations and high earners. That represents a break with the past.
  • A Missing Plan for Social Security: Like the president’s previous budgets, his new proposal makes no mention of the program, which he promised to shore up during his 2020 campaign.

The legislation would suspend the debt ceiling — which caps the amount that the United States is authorized to borrow — until March 2024 or until the debt grows to $32.9 trillion, teeing up another fiscal confrontation just as the 2024 presidential campaign hits a critical period. In exchange for temporarily suspending the cap, House Republicans are demanding that total federal spending be frozen at last year’s levels and that Congress claw back unspent pandemic relief funds and enact stricter work requirements on food stamp and Medicaid recipients.

In his speech, Mr. Biden angrily demanded that Mr. McCarthy agree to an increase in the debt limit without conditions, and insisted that he will not negotiate about spending under the threat of the first default of America’s financial obligations.

“They say they’re going to default unless I agree to all these wacko notions they have,” Mr. Biden said, repeatedly referring to Mr. McCarthy and his party as “MAGA Republicans.” He said Mr. McCarthy’s actions mean that Congress may fail to increase the debt limit in time to prevent a default.

“Let’s be clear,” Mr. Biden said. “If he fails, the American people will be devastated.”

ImagePresident Biden lashed out at Mr. McCarthy and Republicans in a speech at a Maryland union hall.Credit…Doug Mills/The New York Times

House G.O.P. leaders also added measures to the legislation at the request of the hard-right Freedom Caucus to repeal key tenets of Mr. Biden’s landmark health, climate and tax law, including tax credits incentivizing the reduction of greenhouse gas emissions and clawing back the $80 billion allocated to the Internal Revenue Service. While the Republican conference has said it wants to cut spending to reduce the deficit, eliminating the I.R.S. funding would actually reduce government revenues from tax collections, effectively costing the government money, according to congressional scorekeepers.

The bill would also bar the administration from enacting its student loan forgiveness plan and includes a bill already passed by House Republicans to expand domestic mining and fossil fuel production.

All told, the plan amounts to a significant watering down from some of the party’s objectives outlined earlier this year, including balancing the federal budget in 10 years. But facing mounting external pressure to avert a catastrophic default as early as June, Republicans framed the bill as a sensible solution to begin negotiations.

Mr. McCarthy said on Wednesday that the legislation would save taxpayers $4.5 trillion, though no independent agencies have yet assessed the economic impact of the legislation. Analysis by the nonpartisan congressional scorekeeper for tax legislation last year found that repealing Mr. Biden’s full health, climate and tax law would actually increase the deficit.

“Whatever goes to the Senate, you can never” negotiate “up,” said Representative Ralph Norman of South Carolina, a member of the Freedom Caucus who has never voted to raise the debt ceiling. “You can always negotiate down.”

Mr. Biden excoriated Republicans for seeking to protect wealthy people even as they demand cuts that he said will have the biggest negative effect on lower-income Americans.

“MAGA officials are separately pushing for more tax giveaways and overwhelming benefits to the wealthiest Americans and biggest corporations,” Mr. Biden said. “Folks, this time the same old trickle down, dressed up MAGA clothing is worse than ever.”

It was unclear whether Mr. McCarthy had yet secured the votes to pass the legislation. Republicans, plagued by internal divisions, have so far been unable to coalesce the conference around a full budget blueprint. And a small handful of hard-right Republicans, including Representatives Tim Burchett of Tennessee and Eric Burlison of Missouri, have balked at the prospect of raising the debt ceiling at all.

Still, some of the conference’s most conservative lawmakers expressed cautious optimism about the plan, indicating that Mr. McCarthy is not — as of yet — facing an organized bloc of hard-right opposition to what would amount to House Republicans’ opening offer.

Russell T. Vought, the former Trump administration budget director who now leads the far-right Center for Renewing America and has been advising Republicans on their debt limit strategy, praised the proposal as “an important first step towards reining in our unsustainable levels of federal spending along with the woke and weaponized bureaucracy waging war on the American people.”

The proposal Mr. McCarthy unveiled on Wednesday also appeared tailored to assuage the concerns raised by Republicans facing tough re-election fights in swing districts over enacting stronger work requirements for food stamps and Medicaid.

Republican leaders ultimately backed away from including harsher measures, including a move that would have substantially narrowed an exemption from work requirements for food stamp recipients in households with children under 18, excusing only those whose households include children under the age of 7.

That did not stop Democrats, who are demanding that Republicans vote to raise the debt ceiling without any conditions, from crowing about the fissures in the House G.O.P. conference.

“We’re getting closer and closer to when we have to act to avoid default,” said Senator Chuck Schumer of New York, the majority leader. “For all the speeches, for all the letters, for all the wish lists and meetings with this family or that family, the underlying facts haven’t changed: At this point, Speaker McCarthy does not have a plan for avoiding a catastrophic default on the debt.”

Jim Tankersley and Michael D. Shear contributed reporting.


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