On Tuesday, the House is expected to vote on the $4.5 trillion Limit, Save, Grow Act. According to Punchbowl News, this would raise the debt limit until 2024 while cutting federal spending by tens of billions of dollars. US Treasury Department is expected to announce when the US will default on its $31.4 trillion debt this week.
The Act, announced last week by House Speaker Kevin McCarthy (R-CA), is the GOP’s first attempt to bring Democrats and the Biden administration to the table after little movement in the previous three months. It would raise the debt ceiling by $1.5 trillion, or until March 31, 2020, whichever comes first.
Republicans insist on tying a rise in the debt ceiling to spending cutbacks, but the White House wants a ‘clean’ increase in the borrowing limit.
It’s uncertain whether the GOP measure will get enough votes to succeed.
McCarthy predicted that the measure would be passed this week on Sunday.
“We will hold a vote this week, pass it, and send it to the Senate,” he said on Fox News’s “Sunday Morning Futures.”
However, the bill’s current shape is unlikely to succeed since many Republican members, including Reps. Andy Biggs (AZ) and Tim Burchett (TN) have reservations about it. McCarthy could only afford to lose five votes if all Democrats voted against the bill.
In McCarthy’s words, when the bill gets sent to the Senate, they will be demonstrating their ability to raise the debt ceiling into the next year. He added that they are being fiscally responsible and restoring the House. McCarthy advised that it does solve all the problems; it points them in the right direction. McCarthy added that it brings them to the bargaining table, precisely as the government and America want.
The House GOP labored all weekend to build up support for the bill. As of late Sunday night, party officials believed that undecided Republicans were starting to join in. The House Freedom Caucus urges the leadership to implement additional work requirements for social safety net programs under this legislation in FY 2024 rather than FY 2025. Conservatives also want to increase the number of hours insured beneficiaries must work weekly from 20 to 30, and both of these requests appear to the leadership to be improbable.
Democrats seem unaware of McCarthy’s activities. McCarthy wants to get down to business with President Joe Biden and key Democrats to negotiate. To do so, House Republicans must pass this legislation. Otherwise, the House may be obliged to pass a clean debt-ceiling raise this summer. That is what Biden wants, but it would be disastrous for McCarthy. McCarthy ultimately wants three things in a final bill: expenditure cuts, permitting reform, and some work requirements for social services.
Meanwhile, House Republicans are anxious about repealing some tax provisions and if outside groups may see this as a tax hike. A spate of tax benefits from the Inflation Reduction Act was repealed in the House Republican bill. It was particularly concerning to McCarthy and the GOP leadership that Americans for Tax Reform would oppose the elimination of tax credits. According to a statement released by ATR on Sunday afternoon, ATR favors repealing all green new deal tax credits in Biden’s IRA.
On Friday, we also mentioned a group of Midwestern Republicans unhappy about eliminating ethanol credits. GOP leadership sources feel these members will not be a major problem.
All House Republicans were united in their vote against the IRA last year, indicating that these legislators had previously voted against the measures. Second, no one expects this to be included in any final bipartisan agreement between the White House and Senate Democrats.
The House Rules Committee will hear the measure on Tuesday at 4 p.m., implying the bill might be debated on the House floor as early as Wednesday. The House will remain in session till Friday. But don’t expect McCarthy and the rest of the leadership to play games here. House GOP leaders will vote on the floor if they have 218 votes secured.