Republican House Speaker Kevin unveiled a plan on Wednesday to raise the national debt ceiling by $1.5 trillion and cut federal spending by $4.5 trillion. Thus, the speaker launched a tense multiparty debate on the debt ceiling.
McCarthy’s proposal, which he unveiled today in the House of Representatives, would reduce total domestic and military spending to 2022 levels and cap annual growth at 1%. This will not include pension and health programs, which are expected to expand significantly as the population ages.
President Joe Biden and the Democratic-controlled Senate are likely to reject the proposals, but McCarthy said they would form the basis of bipartisan talks to raise the federal government’s debt limit to $31.4 trillion in the coming weeks. Failure to raise the debt ceiling could lead to a default that would rock the US economy and the world.
McCarthy’s plan would also scrap the green energy stimulus Biden signed into law last year, boost domestic oil and gas production and undo administration efforts to write off $400 billion in student loan debt. .
Additionally, Republicans are proposing to return unspent COVID-19 relief funds to recipients, repeal recent Internal Revenue Service budget increases, and introduce stricter eligibility requirements for a number of benefits.
Congress will also have more power to block Biden administration decisions under the proposal.
McCarthy said total government spending will be cut by $4.5 trillion over the next 10 years. This will not be enough to eliminate the budget deficit, which is expected to add more than $20 trillion to public debt over this period.
“President Biden has a choice: sit down at the negotiating table and stop playing partisan political games, or close his ears, refuse to negotiate, and awkwardly risk shoving his way into the government’s first default. history of our country,” McCarthy said. in the House of Representatives.
He did not say when the House of Representatives would vote on the plan.
Biden reaffirmed his position that Congress should raise the debt ceiling by $31.4 trillion without conditions, as he did three times under his Republican predecessor, Donald Trump.
“Let’s have a really serious, detailed conversation about how to grow the economy, reduce costs and reduce deficits,” the president said.
The Biden administration’s budget, released last month, would save $3 trillion over 10 years, mostly through higher taxes.
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