WASHINGTON The Republican-controlled House will vote next week to permit the government to borrow more money to meet its obligations, a move aimed at heading off a market-rattling confrontation with President Barack Obama over the so-called debt limit.
Full details arent settled yet, but the measure would give the government about three more months of borrowing authority beyond a deadline expected to hit as early as mid-February, No. 2 House Republican Eric Cantor of Virginia said Friday.
The legislation wouldnt require immediate spending cuts as earlier promised by GOP leaders like Speaker John Boehner of Ohio. Instead, its aimed at forcing the Democratic-controlled Senate to join the House in debating the federal budget. It would try to do so by conditioning pay for members of Congress on passing a congressional budget measure.
We are going to pursue strategies that will obligate the Senate to finally join the House in confronting the governments spending problem, Boehner told GOP lawmakers at a retreat in Williamburg, Va. The principle is simple: no budget, no pay.
The Senate hasnt passed a budget since 2009, which has drawn lots of criticism from Republicans but protected Democrats controlling the chamber from politically difficult votes.
Senate Majority Leader Harry Reid welcomed the House GOP move.
It is reassuring to see Republicans beginning to back off their threat to hold our economy hostage, said Reid spokesman Adam Jentleson. If the House can pass a clean debt-ceiling increase to avoid default and allow the United States to meet its existing obligations, we will be happy to consider it.
GOP leaders have been grappling with how to gain leverage in their battles with Obama over the budget. Boehner successfully won about $2 trillion in spending cuts as a condition of increasing the governments borrowing cap in 2011.
Obama, however, was dealt a stronger hand by his re-election in November and successfully pressed through a 10-year, $600 billion increase on upper-bracket tax payers earlier this month.
Other choke points remain, including sharp across-the-board spending cuts that would start to strike the Pentagon and domestic programs alike on March 1 and the possibility of a partial government shutdown with the expiration of a temporary budget measure on March 27.
Failing to meet those deadlines would have far less serious consequences than defaulting on U.S. obligations like payments to bondholders, Social Security recipients and myriad other commitments when the government confronts a cash crisis and can no longer borrow to make payments. That could cause a meltdown in financial markets and would inflame voters already disgusted with Congress.
Boehner has previously invoked a promise that any increase in the governments borrowing cap would be matched, dollar for dollar, by spending cuts or reforms that could include curbs on the long-term growth in retirement programs such as Medicare. Fridays announcement did not repeat that specific promise.
Before there is any long-term debt limit increase, a budget should be passed that cuts spending, Boehner said. The Democratic-controlled Senate has failed to pass a budget for four years. That is a shameful run that needs to end, this year.
The measure picked up support from key GOP conservatives, including the current and former chairmen of the Republican Study Committee, a powerful group inside the House GOP.
In order to allow time for the Senate to act, next weeks bill will extend the debt limit for three months, the Study Committee said Friday in a statement. This is a necessary first step as we work to halt the decline of America and puts the focus where it belongs: on the Senate who has failed to do their jobs to pass a budget for more than three years. The statement was issued by RSC Chairman Steve Scalise, R-La., and former chairmen, Jim Jordan, R-Ohio, Tom Price, R-Ga., and Jeb Hensarling, R-Texas.
Obamas budget is due early next month but is expected to be released several weeks later.