The Limit, Save, Grow Act, which was unveiled on Wednesday, seeks to increase the debt ceiling by $1.5 trillion or until March 31, 2024, whichever comes first.
It suggests returning discretionary expenditure ceilings to fiscal 2022 levels while capping growth at 1% per year for the next ten years. Although Republicans have long claimed that military expenditure would not be affected by the cutbacks to discretionary spending, the measure contains no specific language protecting this spending, leaving it up to the discretion of the appropriators.
President Biden has refused to talk with McCarthy on the issue and has called for a “clean” debt limit hike that isn’t coupled with any other policy considerations, prompting the effort to introduce a measure to lift the debt ceiling.
In a speech on the House floor, McCarthy stated, “Now that we’ve introduced a clear plan for responsible debt limit increase, they have no more excuse and refuse to negotiate.”
A floor vote on the measure is anticipated for the following week. McCarthy will need to put up effort to get majority support, however, since there is only a four-vote margin of victory.
On Wednesday, McCarthy told reporters that he is optimistic about the bill’s prospects of passing.
Republicans wanted to use the debt ceiling as a means of forcing budget cutbacks, but when McCarthy presented the proposal to the conference on Tuesday, leaders added additional policy recommendations, which helped win over extreme conservatives who demanded even deeper expenditure cuts.
Rep. Bob Good (R-VA), a member of the House Freedom Caucus, participated in conversations on Tuesday. “With the discussions that I’ve been in, I think that we can get 218,” he stated. “I believe the conference will result in something positive that reduces spending, enacts significant reforms, and advances our nation’s fiscal stability.”
The head of the Main Street Caucus, Rep. Dusty Johnson (R-S.D. ), expressed confidence in the idea receiving “widespread support throughout the conference.” But he said that there are still “a few details to be worked out,” criticizing Biden for the debt ceiling negotiations’ slow pace of advancement.
He made the remark just before the text of the bill was made public: “The stew is not finished cooking.” But I have to admit, the Speaker has made significant progress over the last several months, which is amazing considering that the president won’t engage in negotiations, which is typically how agreements are shaped.
House Budget Chairman Jodey Arrington (R-Texas), whose relationship with the Speaker recently came under investigation after The New York Times reported difficulties between the two leaders as Arrington’s committee is drafting a long-term budget resolution, will be in charge of the measure, according to McCarthy.
Republicans claim that the bill contains $4.5 trillion in “savings” for taxpayers, but Democrats have already voiced their opposition to a number of Republican proposals, including those that would recoup money that Democrats claim was previously appropriated by Congress for the fight against the coronavirus and would target the Biden administration’s decision to forgive student loans and the ongoing repayment pause.
The H.R. 1 Lower Energy Costs Act, a significant energy policy enacted by the House GOP last month, is included in the debt limit legislation.
Additionally, the plan contains provisions that address parts of the Inflation Reduction Act, a centerpiece of Biden’s domestic program that Democrats approved last year without GOP backing. McCarthy, who was ostensibly referring to the green energy tax credits, stated that it would halt the legislation’s “green giveaways,” which he said would amount to almost $70 billion in increased IRS spending.
The measure also includes new job requirements for public assistance programs. For people aged 50 to 56, this involves tightening the job requirements for the Supplemental Nutrition Assistance Program (formerly known as food stamps). The Temporary Assistance for Needy Families program is also up for revision.
Although the plan does not contain changes to Social Security and Medicare, as Republicans have long promised, a component of it establishes work requirements for Medicaid.
Frank Pallone Jr., the ranking member of the Energy and Commerce Committee and a Democrat from New Jersey, said in a statement immediately after the bill’s introduction that the ideas would result in millions of people losing their health insurance “because Republicans do not believe in our country’s social safety net.”
He said, “Let me be clear, this proposal is dead on arrival. Republicans are fabricating a debt crisis to justify these cruel plans.”
According to a statement released by the White House on Tuesday night, Biden, Senate Majority Leader Chuck Schumer of New York, and House Minority Leader Hakeem Jeffries of New York said they “won’t negotiate over default.”
The White House claimed that after Republicans offer their proposal, “the president told Leader Schumer and Leader Jeffries that he was ready to have a separate negotiation over the budget, as has been done by both parties in Congress and the White House in the past.”
Prior to meeting with McCarthy, which is not likely to happen anytime soon, Biden has requested that Republicans provide a long-term budget plan.
Though most of the package amounts to a Republican policy wish list that faces severe resistance in the Democratic-led Senate, Republicans view their stark demands in a bill as a vehicle to get Biden to the negotiation table.
By the end of the “extraordinary measures” being taken by the Treasury Department to prevent default, which experts fear would result in widespread economic unrest, Congress is anticipated to take action on the debt ceiling.
Various forecasts have been made about when the country would reach the so-called “X-Date,” although some claim that a default danger might arise as early as June. The closer the country gets to the deadline, the more exact estimations are anticipated by experts.