When Congress returns this week, House Republicans will attempt to agree on a plan to raise the $31 trillion federal debt ceiling and reduce government spending.
Following months of demands by President Joe Biden that Congress raise the debt ceiling without conditions, House Speaker Kevin McCarthy (R-CA.) will give a speech at the New York Stock Exchange (NYSE) on Monday (April 17), where he’ll discuss the terms Republicans want Democrats to agree to in exchange for moving on the debt ceiling.
McCarthy hasn’t offered many details ahead of the speech, but Republicans are proposing capping annual spending growth at 1 percent for ten years, boosting energy production, and reducing regulation.
Members of the GOP’s sometimes divisive House caucus, which has a narrow 222-213 majority, have yet to agree on any actual legislation.
However, even if House GOP could agree on Legislation, Republicans would have to negotiate with Biden’s Democrats, who control the Senate, before their proposals become law.
Additionally, the White House, which leads the Democratic approach to the debt ceiling, has rejected all Republican proposals so far as unrealistic.
Time is running out to act.
Forecasters are warning that unless Congress acts, the federal government could face a historic default over the summer.
Failure to agree to raise the debt ceiling could cripple the U.S. and global economies and force a downgrade of the U.S. credit rating, which happened during the 2011 debt impasse.
But McCarthy’s speech, which Republicans say is designed to bolster Wall Street support for the spending talks, could spark a movement on the proposals after months of inaction.