Speaker of the House Kevin McCarthy introduced a new bill to increase the federal debt ceiling until January 1, 2025. The proposed legislation, known as the Fiscal Responsibility Act, spans 99 pages and includes various provisions to address spending concerns. It seeks to maintain non-defense discretionary spending at the levels of Fiscal Year 2022 while capping federal spending increases at a maximum of one percent per year over six years. The bill also includes measures to reinstate student loan payments, implement reforms to expedite energy projects, and impose work requirements for welfare recipients.
After several weeks of negotiations, McCarthy and President Joe Biden agreed on the bill. In a joint statement, McCarthy, House Majority Leader Steve Scalise, House Majority Whip Tom Emmer, and Republican Conference Chairwoman Elise Stefanik expressed their belief that the Fiscal Responsibility Act reflects a responsible approach to safeguarding future generations and upholding the principles and commitments of their party. The legislation does not specify a dollar amount for the debt limit increase. This differs from the Limit, Save, Grow Act, which House Republicans previously passed, as it proposed raising the debt ceiling by $1.5 trillion or until March 2024.
Certain conservative Republicans, including Representatives Dan Bishop of North Carolina and Chip Roy of Texas, have objected to the legislation’s absence of a specific amount. Republican Governor and presidential candidate Ron DeSantis of Florida criticized Speaker McCarthy for what he deemed an inadequate response to spending concerns, stating that the bill allowed for a substantial increase in spending, exacerbating the existing trajectory toward bankruptcy.
In response to Republican criticism regarding the defense spending included in the agreement reached with House Speaker Kevin McCarthy to avoid a potentially catastrophic default on the nation’s debt, President Joe Biden addressed the concerns on Monday.
As he was departing for Delaware, Biden spoke with reporters dismissing the criticisms and expressing confidence in bipartisan support for any additional defense spending that may be necessary.
Biden stated that if there were further requirements for the military, he had no doubt that it would receive bipartisan approval. He highlighted that his proposed defense budget had already been passed, indicating that the requested funding had been approved.
The President emphasized that in the event of any urgent need for additional funding, he was confident it would be jointly addressed and secured with bipartisan cooperation.
When questioned about the complaints from Republicans, Biden made it clear that he believed there would be a collaborative approach to meet any essential defense funding needs.
During the press conference, President Biden characterized the agreement as a compromise, acknowledging that it didn’t fully satisfy everyone’s desires but emphasized governing responsibility. He called for the U.S. House and Senate to pass the bipartisan agreement.
Treasury Secretary Janet Yellen provided an updated deadline, noting that the federal government’s default on its debts is now expected by June 5 instead of the previously estimated June 1. The House of Representatives cannot vote on the bill until Wednesday, May 31, due to a rule that mandates a 72-hour review period for all pieces of legislation before scheduling votes.