House Republicans pushed their debt ceiling package to a vote as soon as Wednesday as Speaker Kevin McCarthy and his leadership team huddled with key holdouts late into Tuesday evening, working to ensure they would have majority support for passage.
Prospects for the sweeping package were buoyed by a nonpartisan Congressional Budget Office analysis showing the Republican plan would reduce federal deficits by $4.8 trillion over the decade if the proposed changes were enacted into law. The House Republican plan would lift the debt ceiling by $1.5 trillion into 2024 in exchange for steep budget cuts Democrats and even some Republicans oppose. President Joe Biden has threatened to veto the bill.
McCarthy declined to say late Tuesday whether he had the 218 votes needed from his slim majority in the face of Democratic opposition.
The Republican speaker's office at the U.S. Capitol became a revolving door of lawmakers coming and going, including a contingent of Iowa lawmakers believed to have concerns over gutting clean energy tax breaks for biofuels. With 222 Republicans in the majority, and absences expected this week, McCarthy has almost no votes to spare.
"There’s been a lot of fruitful conversations and we’re confident we’re going to get it passed," said Rep. Mike Johnson, R-La., the vice chairman of the House Republican conference.
While the 320-page package has almost no chance of becoming law, McCarthy is using it as a strategy to shake up the debate. Biden has so far refused to engage with the House Republicans on what the White House calls “hostage taking” over the debt ceiling. McCarthy hopes passage will kickstart talks with Democrats.
From the White House, the administration said the president would veto the bill. Biden dismissed the Republican ideas as the “same old trickle down” economics down “dressed up in MAGA clothing,” a reference to the Trump-era ”Make America Great Again" slogan that has come to represent the more extreme elements in the Republican Party.
”To default would be totally irresponsible,” Biden said at an event Tuesday after announcing his reelection campaign.
It's a first big test for the president and the Republican speaker, coming at a time of increased political anxiety about the need to raise the federal debt limit, now at $31 trillion, to keep paying the country's already accrued debts.
The Treasury Department is taking “extraordinary measures” to pay the bills, but funding is expected to run out this summer. Economists and experts warn that even the threat of a federal debt default would send shockwaves through the economy.
“This economic catastrophe is preventable,” Treasury Secretary Janet Yellen said in a speech Tuesday. “The solution is simple: Congress must vote to raise or suspend the debt limit. It should do so without conditions. And it should not wait until the last minute.”
To push the bill to passage Wednesday or later this week, McCarthy was working to unite the “five families” — the often warring factions of the House Freedom Caucus and others that make up the House Republican majority.
In exchange for raising the debt limit by $1.5 trillion into 2024, the bill would rollback federal spending to fiscal 2022 levels and cap future spending at 1% a year for the next decade.
The package would also impose tougher work requirements on recipients of food stamps and government aid, halt Biden's plans to forgive up to $20,000 in student loans and end the landmark renewable energy tax breaks Biden signed into law last year. It would tack on a sweeping Republican bill to boost oil, gas and coal production.
Lawmakers were negotiating late into the evening Tuesday on last-minute changes. Lawmakers for Iowa and other Midwestern states had concerns about rescinding new tax breaks on biofuels, while a member of the Freedom Caucus wanted more changes to bolster work requirements.
Rep. Scott Perry, R-Pa., the chairman of the Freedom Caucus, said he was waiting to see the final product..
“There's a lot of questions,” said Rep. Kevin Hern of Oklahoma, the chairman of the powerful Republican Study Committee.
But Hern said McCarthy let the caucus leaders know, "He’s not changing the bill.”
Senators have been bystanders in the debate, but are awaiting next steps.
Senate Majority Leader Chuck Schumer called the Republican bill “a wish-list straight out of the Freedom Caucus playbook. It might as well be called the Default On America Act because that’s exactly what it is: DOA.”
But Senate Republican Leader Mitch McConnell said, "It’s time for President Biden to stop the partisan stubbornness, join Speaker McCarthy at the grown-ups’ table, and get talking.”
On Tuesday, the nonpartisan Congressional Budget Office said if the changes proposed in the bill were carried out it would shave $4.8 trillion off the deficit over the next decade, with large chunks coming from ending the student loan forgiveness and green energy tax breaks.
