Speaker Kevin McCarthy unveiled the Republican budgetary plan Wednesday. It puts the GOP and Joe Biden on a collision course over the debt ceiling.
McCarthy’s “Limit, Save, Grow Act” would curb the rate of growth of discretionary spending, pegging it at Fiscal Year 2022 levels.
“President Biden has a choice,” McCarthy said in a speech from the House floor Wednesday. “Come to the table and stop playing partisan political games, or cover his ears, refuse to negotiate and risk bumbling his way into the first default in our nation’s history.”
A default would spell catastrophe
The debt ceiling is the maximum amount the federal government can spend on existing fiscal obligations such as Social Security and government salaries.
Treasury Secretary Janet Yellen notified Congress in January that the federal government would default on its debt obligations in June unless a deal was reached on the debt ceiling. She warned that a default would usher in a financial collapse.
“A default on our debt would trigger an economic and financial catastrophe,” she said.
The Biden administration unveiled its $6.9 trillion budget proposal in March. McCarthy’s plan would cut projected growth in the federal budget by $4.5 trillion. He tied these cuts to a $1.5 trillion increase in the debt ceiling.
“Guess what? He’s attempting to try to make [default] happen now,” Biden said minutes after McCarthy unveiled his plan. “Massive cuts to programs you count on. Massive benefits protected for those at the top.”
Biden strikes back
Biden slammed the GOP plan for allegedly “finding ways to squeeze out more of America’s middle class.”
At the current rate, the Social Security trust fund will be completely depleted in 2034, just 11 years from now, unless Congress acts, a Treasury Department report released in March said.
Biden claims that he wants nothing different than what former President Donald Trump and prior presidents had when the debt ceiling increased during their presidencies. McCarthy opposed both Trump and Obama when they came to Congress seeking to increase the national debt. Trump obtained a debt-ceiling increase in 2017 by working with Democrats and bucking the Republican leadership.
When Trump became president the national debt stood at $20 trillion. Today the national debt is $31.6 trillion.
“Now that we’ve introduced a clear plan for a responsible debt limit increase, they have no more excuse and refuse to negotiate,” McCarthy said. “The president is ignoring the debt crisis.”
Bipartisan appeal?
McCarthy and the Republicans have an ally among Senate Democrats in the person of Sen. Joe Manchin, D-W.V., who has felt betrayed by the Biden administration’s spending priorities in the Inflation Reduction Act.
“Our elected leaders must stop with the political games, work together and negotiate a compromise. Instead, it has been more than 78 days since President Biden last met with Speaker McCarthy. This signals a deficiency of leadership, and it must change,” Manchin said in a statement. “… [W]e are long past time for our elected leaders to sit down and discuss how to solve this impending debt ceiling crisis.”
Manchin does not agree with everything in the Republican plan; however, he views the proposal as a good place to start in negotiations.
“I applaud Speaker McCarthy for putting forward a proposal that would prevent default and rein in federal spending. While I do not agree with everything proposed, the fact of the matter is that it is the only bill actually moving through Congress that would prevent default,” Manchin said. “For the sake of the country, I urge President Biden to come to the table, propose a plan for real and substantive spending cuts and deficit reduction, and negotiate now.”
Senate Majority Leader Chuck Schumer told The Hill that McCarthy’s plan has no chance of passage once it hits the Democrat-controlled Senate.
“The biggest losers in Speaker McCarthy’s agenda are parents, kids, law enforcement, small business, countless others who work hard every single day to make ends meet,” Schumer said.
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John Rossomando was a senior analyst for Defense Policy and served as Senior Analyst for Counterterrorism at The Investigative Project on Terrorism for eight years. His work has been featured in numerous publications such as The American Thinker, Daily Wire, Red Alert Politics, CNSNews.com, The Daily Caller, Human Events, Newsmax, The American Spectator, TownHall.com, and Crisis Magazine. He also served as senior managing editor of The Bulletin, a 100,000-circulation daily newspaper in Philadelphia, and received the Pennsylvania Associated Press Managing Editors first-place award in 2008 for his reporting.
