House Republicans plan to pass legislation to raise the debt ceiling for one year in the coming weeks.
House Speaker Kevin McCarthy (R-CA) said the package will also include federal spending cuts and new rules requiring people to work if they want to receive federal benefits.
- The GOP will propose reverting federal spending on programs like the military to last year's levels.
- The plan will cap growth on spending on discretionary programs, which excludes Social Security and Medicare, to 1% a year.
- It will require the federal government to rescind pandemic funding that has not yet been spent, McCarthy said.
- The GOP has enough votes to pass the legislation but the Democrat-controlled Senate will likely reject the plan.
- President Joe Biden and Congressional Democrats have said that raising the debt ceiling should be separate from negotiations about federal spending.
- McCarthy pushed back against this idea, saying that "a no-strings-attached debt-limit increase will not pass" in the House.
- The Treasury Department began relying on special accounting measures early in 2023 to keep paying the federal government's bills after coming close to the ~$31.4 debt limit.
- The funds are expected to run out between July and September, and if the debt ceiling is not raised by then, the U.S. will be forced to default on its debt.
