The Republicans, who are in control of the House of Representatives, voted on the evening of Wednesday, April 26, to pass a bill that raises the US debt ceiling but in return requires drastic budget cuts and the dismantling of energy and environmental measures contained in Joe Biden’s Inflation Reduction Act, which was passed in the summer of 2022.
The bill has no chance of passing the Democratic-controlled Senate, and President Biden has promised to veto it, but the vote could kick-start serious negotiations on raising the US debt ceiling.
The debt ceiling, set at $31.4 trillion (€28.4 trillion), is projected to be reached in June. Since the early 1960s, this limit has been raised by Congress 78 times. The matter has routinely turned into a melodramatic confrontation between Democratic presidents (Bill Clinton, Barack Obama) and the House of Representatives when controlled by Republicans, sometimes leading to a federal government shutdown. Although a catastrophic default by the US Treasury has never occurred, relations in Washington are so tense that no one wants to rule out the possibility.
Earlier in the day, Biden had reiterated that he refused any conditions on raising the infamous ceiling. “Happy to meet with [Kevin] McCarthy [the Republican speaker of the House of Representatives]. But not on whether or not the debt limit gets extended,” he said Wednesday at a White House press conference. “That’s not negotiable.” Back on Tuesday, the Biden administration had called the bill a “reckless attempt to extract extreme concessions as a condition for the United States simply paying the bills it has already incurred.”
Forcing a political agenda on Biden
White House spokeswoman Karine Jean-Pierre spoke forcefully after the vote: “In our history, we have never defaulted on our debt or failed to pay our bills. Congressional Republicans must act immediately and without conditions to avoid default and ensure that the full faith and credit of the United States is not put at risk. That is their job.” She railed against a bill that “cuts veterans’ health care, education, Meals on Wheels and public safety; takes away health care from millions of Americans; and sends manufacturing jobs overseas while they fight to extend the Trump tax cuts for the wealthiest and profitable corporations.”
For McCarthy, it was a matter of forcing a political agenda on President Biden, who has just declared that he will run for a second term in the 2024 presidential election, but above all of rallying his troops to go to the negotiating table with the Democratic president. This was a major political test for this California congressman, who was elected speaker in January after 15 votes, with the hardcore Trump supporters in the House refusing to back him and making bold policy demands. His 320-page bill would slightly raise the debt ceiling by $1.5 trillion. In exchange, he demands a $4.5 trillion reduction in federal spending over 10 years.
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