House GOP's long-awaited debt limit bill features $1.5T increase

House Republicans’ go-it-alone debt limit bill would pair a $1.5 trillion increase in the debt ceiling expected to last into next year with $4.5 trillion in savings, Speaker Kevin McCarthy (R-Calif.) said Wednesday.

The bill unveiled Wednesday, dubbed the Limit, Save, Grow Act, proposes reverting discretionary spending for non-defense programs to fiscal year 2022 levels, while proposing limiting growth to 1 percent annually over the next decade.

It will raise the debt limit by $1.5 trillion or through March 31, 2024, whichever comes first, McCarthy told reporters.

The move to release a debt limit increase bill, which is intended to bring President Biden to the negotiating table, comes as Biden has refused to negotiate with McCarthy on the matter. The president reiterated calls on Tuesday for a “clean” debt limit increase not paired with any other policy points. 

“Now that we've introduced a clear plan for Responsible debt limit increase, they have no more excuse and refuse to negotiate,” McCarthy said on the House floor.

McCarthy said in a speech ahead of the bill’s release that it would help lead to $4.5 trillion in savings for taxpayers, partly through spending cuts, clawing back unspent coronavirus funding previously allocated by Congress and targeting the Biden administration’s student loans forgiveness decision.

The bill additionally includes measures targeting aspects of the Inflation Reduction Act, a signature piece of Biden's domestic agenda that Democrats passed without GOP support last year. It would pull roughly $70 billion in an IRS funding boost and end that legislation’s “green giveaways,” McCarthy said in an apparent reference to green energy tax credits.

Those measures came after many GOP members on Tuesday suggested adding those cuts to the bill. And with the inclusions, McCarthy appears to be winning over hard-line conservatives to support the bill ahead of an expected vote next week.

“With the discussions that I've been in, I think that we can get 218,” Rep. Bob Good (R-Va.) said. “I think we're going to come up with something good out of the conference that cuts spending, makes significant reforms and puts us a step closer towards fiscal stability as a country.”

McCarthy said the bill will be led by House Budget Chairman Jodey Arringon (R-Texas), whose relationship with the Speaker recently came under scrutiny after the New York Times reported tensions between the two leaders as Arrington’s committee is crafting a long-term budget framework.

The bill is expected to get a floor vote next week, with McCarthy telling reporters on Wednesday that he’s confident about the bill’s chances of passage in the days ahead.   

The White House said on Tuesday evening that Biden, along with Senate Majority Leader Chuck Schumer (D-N.Y.) and House Minority Leader Hakeem Jeffries (D-N.Y.), agreed in a discussion they “won’t negotiate over default.” 

“The president told Leader Schumer and Leader Jeffries that he was ready to have a separate negotiation over the budget once Republicans present their plan, as has been done by both parties in Congress and the White House in the past,” the White House said.

Biden has asked that Republicans release a long-term budget plan before meeting with McCarthy, which is not expected any time soon.

Republicans see their black-and-white asks in a bill as a way to draw Biden to the negotiating table, though much of the package amounts to a Republican policy wish list that faces fierce opposition in the Democratic-led Senate.

Congress is expected to act on the debt limit by sometime this summer when the Treasury Department exhausts the “extraordinary measures” being taken to avoid default, an outcome experts say would cause mass economic turmoil.

Estimates vary as to when the nation will reach the so-called “X-Date,” but some projections say the country faces a possible default threat as early as June. Experts expect more precise estimates the closer the nation comes to the deadline. 

Republicans say the partisan bill is the culmination of months of input and workshopping ideas from all corners of the conference’s various factions. But with just a four-vote majority, McCarthy will have to work to ensure it reaches majority support.

Ahead of the release on Wednesday, Rep. Dusty Johnson (R-S.D.), chair of the Main Street Caucus, expressed confidence in the plan notching “widespread support throughout the conference.” But also said there are “a few details to be worked out,” while also taking aim at Biden over the current rate of progress in debt limit talks.  

“The stew is not done cooking,” he said. “But I gotta tell you, the Speaker has brought us a long way in the last couple of months, which is remarkable given the fact that the president refuses to negotiate – and that's normally how you see the contours of a deal come together.”

Mychael Schnell contributed.