McCarthy unveils debt ceiling bill that targets Biden agenda

WASHINGTON — House Speaker Kevin McCarthy, R-Calif., on Wednesday unveiled his plan to raise the debt ceiling by $1.5 trillion over nearly a year while trying to roll back key parts of President Joe Biden’s agenda.

McCarthy said the bill, called Limit, Save, Grow Act of 2023will save American taxpayers more than $4.5 trillion by limiting discretionary spending, seizing unused pandemic-related funds, eliminating Biden’s student loan forgiveness plan and cutting funds appropriated for the Internal Revenue Service.

The cuts are in exchange for a one-year increase in the debt ceiling. McCarthy called on Biden and Senate Majority Leader Chuck Schumer, DN.Y., to “sit down, negotiate and address this crisis” but did not say whether the bill had enough support to pass. Biden refused to negotiate on the debt limit. Extraordinary measures to avoid the first ever US sovereign debt default are about to run out this summer.

“Now that we have introduced a clear plan for a responsible increase in the debt limit, they have no excuse and refuse to negotiate,” McCarthy said.

McCarthy did not say when he would bring the bill to a vote in the House. It’s still unclear whether he has the support within his own caucus to pass the bill. “I’m not giving up, we’re going to get them,” he told NBC News on Wednesday.

Even if the House GOP passes it, the Democratic-controlled Senate will likely kill the measure.

McCarthy’s announcement came after days of speculation about the GOP’s proposal to temporarily raise the debt limit for some cuts, such as a stall on non-defense discretionary spending.

The House speaker also doubled down on proposals for stricter work requirements for adults without dependents, the repeal of Biden’s “army of 87,000 IRS agents” and the mag’s loan forgiveness program. -study of the president, who can be killed by the Supreme Court. The justices are expected to rule on the student loan program in early summer.

McCarthy also argued that the measures would protect Social Security and Medicare by encouraging more people in the workforce to pay for it. But Democrats say it will hurt millions.

“Speaker McCarthy’s proposal is not about jobs,” said Rep. Frank Pallone, DN.J., ranking member of the House Energy and Commerce Committee, after McCarthy’s announcement. “This is a Trojan Horse intended to use red tape and heavy paperwork to kick millions of people off their health insurance because Republicans don’t believe in our nation’s social safety net. Republicans are creating a crisis into debt to justify these cruel plans.”

The Republicans’ narrow majority in the House meant that McCarthy could only lose a handful of GOP votes due to opposition from Democrats.

“Let me be clear, this proposal is dead on arrival,” Pallone said on Wednesday.

The White House has maintained that it will not negotiate on the debt ceiling and that Congress must pass a clean increase and address any budget concerns separately. White House press secretary Karine Jean-Pierre said Wednesday that the administration was aware of McCarthy’s plans to release a proposal but condemned it as playing politics with something that is the “responsibility” of Congress.

Biden also took McCarthy’s approach on Wednesday. “The MAGA Republicans in Congress are threatening to default on the national debt, the debt that took 230 years to accumulate in general, unless we do what they say,” the president said in a speech in Maryland.

–CNBC’s Emma Kinery contributed to this report.