McCarthy unveils House GOP plan to increase the debt limit, calls on Biden to begin talks

Washington — House Speaker Kevin McCarthy unveiled a bill that would increase the debt limit while cutting government spending, making his opening offer to the White House and Democrats ahead of a summer deadline to avoid a default.

The GOP plan would increase the debt limit by $1.5 trillion or until the end of March 2024, whichever comes first, McCarthy said in brief remarks on the House floor Wednesday. Known as the Limit, Save, Grow Act, McCarthy said the bill includes $4.5 trillion in savings by cutting discretionary spending to fiscal year 2022 levels and limiting the growth of future spending. It would also reclaim unspent COVID-19 funds, cancel President Biden’s student loan forgiveness program and enact work requirements for federal aid programs.

“If Washington wants to spend more, it will have to come together and find savings elsewhere, just like every household in America,” the speaker said. “President Biden has a choice. 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.”

McCarthy’s bill is expected to reach the House floor next week. While any legislation that pairs a debt-limit increase with spending cuts is dead on arrival in the Democratic-controlled Senate, McCarthy is hoping to gain leverage ahead of expected negotiations with the White House by passing the GOP’s own bill in the House. 

The White House has called on the House to pass a “clean” debt ceiling increase with no spending cuts attached, and has refused to negotiate with McCarthy until he unveiled his own proposal. The speaker again called on the president to begin talks in his remarks on Wednesday.

“They need to sit down, negotiate and address this crisis. Now that we’ve introduced a clear plan for responsible debt limit increase, they have no more excuse and refuse to negotiate,” McCarthy said. 

Further complicating matters, it remains unclear whether McCarthy has sufficient support for the GOP bill within his own caucus. McCarthy can afford only a handful of defections in the House given Republicans’ slim majority. 

Tennessee Republican Rep. Tim Burchett said McCarthy briefed him and some other members in a meeting Wednesday afternoon, but “it wasn’t really a pitch” or a “hard sale.” Burchett said he’s “not there yet” on supporting the plan, but said he was the only person in the meeting not on board with it. GOP Rep. Barry Loudermilk of Georgia said it’s not yet clear whether the bill will go through a committee process or head straight to the floor. 

The U.S. Treasury reached the current debt limit of $31.4 trillion in February, but Treasury Secretary Janet Yellen has employed “extraordinary measures” to avoid a default until sometime in June. 

Nikole Killion contributed to this report.