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McCarthy to Biden on debt limit: ‘You are on the clock’

Speaker tells president to have his people get in touch by week's end; cites 'rapidly approaching deadline'

Speaker Kevin McCarthy, R-Calif., conducts a news conference in the Capitol on March 24.
Speaker Kevin McCarthy, R-Calif., conducts a news conference in the Capitol on March 24. (Tom Williams/CQ Roll Call)

Speaker Kevin McCarthy on Tuesday wrote to President Joe Biden asking him to set a date for their next negotiating meeting on the debt limit by the end of the week.

The California Republican reiterated that his conference is set on pairing any debt limit increase with policies that would cut spending, save taxpayers money and spur economic growth, while offering four examples of the types of proposals he and Biden could discuss.

McCarthy’s examples, which he stressed were not exhaustive, included cutting nondefense discretionary spending to “pre-inflationary” levels and limiting out-year growth; rescinding unspent pandemic aid; strengthening certain benefit programs’ work requirements for able-bodied adults without dependents; and other legislation, such as an energy policy overhaul to spur more domestic production and border security measures that would stop the flow of fentanyl.

“Taken together, such policies would help the number one issue facing Americans today: stubbornly high inflation brought on by reckless government spending,” McCarthy wrote.

Separately in a CNBC interview Tuesday morning, McCarthy said the ideas he is putting on the table would generate more than $4 trillion in savings. His office did not respond to a request to explain how he arrived at that figure.

A proposal to set fiscal 2024 discretionary spending at the fiscal 2022 level of roughly $1.5 trillion and limit annual increases to 1 percent growth over the rest of the decade would generate nearly $3 trillion, according to estimates from the House Freedom Caucus and Budget Chairman Jodey C. Arrington, R-Texas.

Members of the ultra-conservative Freedom Caucus first proposed that idea earlier this month and Arrington said in an interview last week that his panel’s budget resolution would be written to include it. Other proposals from the Freedom Caucus, Republican Study Committee, Arrington and others could boost total savings to over $4 trillion, including work requirements for benefit programs, rescinding unspent pandemic aid, and blocking Biden’s student debt relief plan and more.

Rep. Andy Biggs, R-Ariz., speaking at a press conference Tuesday, said McCarthy included many of the Freedom Caucus proposals in his letter to Biden. The group’s former chairman was joined by other caucus members in backing McCarthy’s position.

“We’re really gratified to see the speaker send a strong message to the president of the United States that it will be the president who chooses to gamble with the possibility of default, not the United States House of Representatives,” Rep. Chip Roy, R-Texas, said. “We are putting forward concrete plans.”

Republicans across various factions of their conference are eyeing more stringent work requirements for the Supplemental Nutrition Assistance Program, formerly known as food stamps, during the upcoming farm bill reauthorization debate. Some have also discussed work requirements for Medicaid, the joint federal-state health care program for low-income households.

Rep. Andy Biggs, R-Ariz., speaks during a news conference with senators and members of the House Freedom Caucus on the debt limit and spending on Wednesday, March 22, 2023. (Tom Williams/CQ Roll Call)

They’ve also cited a need to update Temporary Assistance for Needy Families, which replaced traditional welfare programs in the 1996 overhaul signed by President Bill Clinton, which McCarthy cited in his letter referencing work requirements. Biden, who was in the Senate at the time, voted for the 1996 welfare overhaul bill.

“Just going back to what Bill Clinton did, working with a Republican Congress” would save “hundreds of billions,” Majority Leader Steve Scalise, R-La., said at a press conference Tuesday, echoing the ideas McCarthy raised in the letter, as ones the conference has been discussing.

No budget, no meeting?

Biden has repeatedly said he will not negotiate conditions for raising the debt ceiling. The president has said he is willing to have separate negotiations with Republicans on spending, but that he wouldn’t sit down with McCarthy again until the GOP released a budget proposal.

“It’s time for Republicans to stop playing games, agree to pass a clean debt ceiling bill, and quit threatening our economic recovery,” White House Press Secretary Karine Jean-Pierre said in a statement. “The president welcomes a separate conversation about our nation’s fiscal future. Earlier this month, he released a budget that cuts the deficit by nearly $3 trillion while lowering costs for families and investing in America.”

McCarthy has said Republicans should not need a budget to negotiate on the debt limit, especially when they’ve put forward ideas and the president has not yet engaged.

The Budget Committee is not expected to release its proposal until after the April 15 statutory deadline for Congress to adopt a joint budget resolution, which is highly unlikely to happen this year under divided government regardless of the timing.

However, the Republican Study Committee is not waiting on the committee’s blueprint before releasing its own budget, the group’s chairman, Kevin Hern, said Tuesday. The bloc of roughly 170 conservatives is planning to release its budget the week of April 17 when members return from a two-week recess, the Oklahoma Republican said.

Hern said the group is “very thrilled” that McCarthy’s letter included options laid out in the RSC’s debt limit playbook, released earlier this month.

‘Roll up our sleeves’

In his letter Tuesday, the speaker said he has “no interest in brinkmanship.” Republicans are not demanding that Congress solve the nation’s fiscal problems overnight but rather stop kicking the can down the road, he argued.

Citing the “rapidly approaching deadline” — experts predict the debt limit “x” date will hit sometime between June and September — McCarthy warned Biden that he is “on the clock.”

“It’s time to drop the partisanship, roll up our sleeves, and find common ground on this urgent challenge,” he wrote. “Please have your team reach out to mine by the end of this week to set a date for our next meeting.”

In the CNBC interview, McCarthy said there’s been “no progress” on the debt limit since he and Biden met at the White House in February.

“Since that time, he has misled the whole Congress and the country,” McCarthy said, citing Biden’s comments to him and other lawmakers, including Democrats at their annual retreat in Baltimore earlier this month, that the two would have another meeting.

Democrats have suggested Republicans don’t have enough votes to pass the kinds of conditions they’re seeking on the debt limit. But McCarthy said a clean debt limit bill couldn’t even get through the Democrat-controlled Senate.

“If they think they can just raise the debt limit, then why don’t they do it in the Senate tomorrow?” he said. “Because the Democrats won’t vote for it either.”

Senate Majority Leader Charles E. Schumer, D-N.Y., criticized McCarthy for floating an “amorphous $4 trillion number” instead of “a real plan.”

“Speaker McCarthy says he wants to sit down with the president,” Schumer said in Tuesday floor remarks. “But he comes to the president’s office with no specific plan, no specific details about what the Republicans want to cut. What are they going to talk about, the weather?”

Aidan Quigley and David Lerman contributed to this report.

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