The Republican leader has put forward a proposal to cut government spending and raise the federal debt ceiling.
US House Speaker Kevin McCarthy unveiled a bill that would combine $4.5 trillion in spending cuts with a $1.5 trillion increase in the federal debt ceiling.
The newly released plan lays out McCarthy’s opening remarks in what is likely to be a tense partisan debate over government borrowing. Here’s a summary of Wednesday’s release:
Debt Ceiling Raised
McCarthy’s bill would suspend the nation’s borrowing limit, currently at $31.4 trillion, until March 31, 2024 or increase by another $1.5 trillion — whichever comes first.
Then, as the 2024 presidential race heats up, Congress will have to wrestle with the issue again.
curb spending
The plan would roll back the amount of spending Congress approves each year to the $1.47 trillion approved for the fiscal year ended Sept. 30. It will also limit spending growth to 1% a year for the next 10 years.
These restrictions will effectively cut spending because they cannot keep up with expected inflation and population growth.
Within that figure, lawmakers still have to determine how much to spend on domestic agencies like the Pentagon and the Environmental Protection Agency, a perennial partisan flashpoint.
Congress agreed to similar spending caps in another debt-ceiling standoff in 2011, but often failed to abide by them in the following years.
Those caps don’t apply to benefit programs like Social Security and Medicare, which are projected to grow dramatically as the population ages.
Recover unspent COVID-19 funds
The plan would eliminate the remainder of the $5.2 trillion Congress approved between 2020 and 2022 to fight COVID-19. According to the White House, remaining funds totaled less than $80 billion in January and may be lower now.
Much of the money is earmarked for struggling union pension funds, veterans health care and medical research.
Cancellation of Student Debt Relief
McCarthy’s proposal would repeal efforts by Democratic President Joe Biden to cancel roughly $400 billion in student debt, which Republicans say is unfair to those who didn’t go to college or have paid off their debt.
The Supreme Court is expected to rule by July on whether the plan is legal.
cuts to IRS funding
The plan seeks to undo an $80 billion investment program for the Internal Revenue Service (IRS), which the tax-collecting agency will use to hire more staff and deploy new technology.
But the nonpartisan Congressional Budget Office expects the new IRS funding to generate about $204 billion through enhanced enforcement.
Repeal the Green Tax Incentive
It would repeal incentives for renewable energy, electric vehicles and other climate-friendly technologies passed by Democrats last year as part of the Lower Inflation Act.
tighten job requirements
The program will strengthen work requirements for participants in the Supplemental Nutrition Assistance Program (SNAP) program, which provides groceries to low-income individuals.
increase regulatory powers
That would give Congress more power to scrutinize new rules proposed by the executive branch and could give Republicans more power to block environmental and workplace regulations, among others they deem harmful.
More incentives for oil and gas
McCarthy’s package included a sweeping fossil fuel bill that passed the Republican-controlled House of Representatives in March but stalled in the Democratic-controlled Senate.
The bill seeks to boost oil and gas production by reducing ties, boosting energy development on federal lands and removing Democrat-backed climate incentives.
