America's Talking - Biden Blasts Republicans’ Debt Ceiling Plan

Episode Date: April 29, 2023

President Joe Biden blasted the Republicans' recently unveiled spending plan to raise the debt limit and cut spending, calling it "a reckless attempt to extract extreme concessions as a condition for the United States simply paying the bills it has already incurred." The Biden administration’s Office of Management and Budget released the statement, making clear the president would veto the Republicans’ recently unveiled bill, "The Limit, Save, Grow Act." Support this podcast: https://podcasters.spotify.com/pod/show/america-in-focus/support Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

Welcome to American Focus, powered by the Center Square. I'm Dan McAulib, executive editor of the Center Square Newswire Service. Joining me again today is Casey Harper, the Center Square's Washington, D.C. Bureau Chief. We are recording this on Friday, April 28th. Casey, the country is facing a looming debt ceiling crisis. Republicans have announced plans for what they would agree to if they were to increase the debt ceiling. President Biden wants nothing to do with the Republicans' plans. Tell us a little bit about it. But, you know, we are coming down to a very serious deadline. And it seems like we are just as far apart from any kind of agreement as we were, you know, two months ago when Janet Yellen, Treasury Secretary was warning about the impact of if we missed this deadline. So what is the deadline? Well, the federal law basically sets a cap on how much debt the U.S. government can have. Right now, you know, we're over $31 trillion, but not to $32 trillion. And so that's where we're budding up against that cap.

the Treasury Department as accountants somehow can do as taking what they call extraordinary measures to keep us from defaulting and doing different things to buy us time, moving money around. But they're not only going to be able to do that so long. We're really down to the wire. And so Congress has to pass and Biden signed an increase to the debt limit. Now, Republicans with their new House majority are saying, yeah, we'll increase the debt limit, but spending's out of control. Inflation is, you know, of course, been raging because of all this spending.

We'll raise the debt limit. we don't want to default, but we're going to have to do some spending cuts. And Biden has said, no, we're not doing any spending cuts. We're not negotiating on this. This is basically too important to get caught up in negotiations and risk defaulting on the debt. And so these two sides are kind of at a standoff. The Senate, of course, is more moderate than the House Republicans, but they have, I would say, more influence with the president. So it'll be interesting to see, but House Republicans pass their bill, their debt ceiling increase, you know, rough sketch of it is it, it cuts, you know, spending, sitting by almost $5 trillion in spending, it raises the debt limit by about

about $1.5 trillion or until March 31st, whichever comes first. Right. So we'll be back in this again in an election year, which is an interesting thing. Maybe we can talk about in a moment, you know, how revisiting this in election year could play out. But it cuts spending. It buys us basically a year or $1.5 trillion increase to the debt limit. It puts things like work requirements for some social programs like Medicaid recipients will need to work about, you know, 20 hours a week, which something Republicans really pushed for. What are some of the other spending cuts that Republicans want? Yeah.

So, I mean, it, for example, there's all, well, there's the tax stuff too. So it rolls back a lot of the climate and energy environmental tax credits that were put in place in the Inflation Reduction Act, which Republicans are very excited about. But the very thing they're excited about is what Biden was not happy about, right? because he just worked really hard to pass these Inflation Reduction Act tax credits as part of his climate change and green initiative, a green economy kind of initiative.

And so now this debt ceiling is coming around. Republicans are just basically trying to undo so many of these tax credits he put in place. So that's a good example of one of these things. It's hard to see how they'll reconcile because Biden just spent so much political capital passing it and now it's trying to be overturned. So I don't know how they're going to meet on this,

but they have to. I mean, if they really have to. Biden wants just a clean debt limit increase. You know, just kick it down the row at another year. Republicans are saying, no, we need to do something about this. So one of the other proposals is that it would essentially block Biden's student loan cancellation plan or wants to forgive up to $10,000 in student loans for some borrowers and up to $20,000 for others. That's, of course, been another contentious issue between the Biden White House. and Republicans in Congress. So, I mean, what's next? I mean, obviously the Republicans have put forward their plan. Biden says, no way. We're running out of time here, right?

Yeah, we are. And they've got to come to something. I mean, there's going to be a lot of backroom deals. Ultimately, this is going to be, I think, McCarthy's biggest test. You know, we covered very closely at the sooner square.com, his tumultuous battle to take the House speakership, I think he has earned himself some credit with the Republicans who put him in charge. By the way, he stood by some of these proposals.

You know, this work requirements for Medicaid stuff is, it's pretty, puts a pretty bad taste in the amounts of some of these Democrats. But he stood by it. He knows that probably all this stuff isn't going to make it through the final negotiations. But he did put some of what you could call wishless items from Republicans. He returns discretionary, you know, spending to 22 levels. I think you asked about more spending. It just returns some of the discretionary spending to 2022 levels and then sets it, you know, for like a 1% increase, a more annualized growth thing. But so McCarthy is really probably going to upset some Republicans or he's going to risk a default. This is a really probably the biggest test of his leadership so far. Can he get,

you know, can he get Biden on his side? And oh, by the way, I mean, some of these Senate Republicans are pretty, pretty squishy, right? So, but nobody wants a default. Nobody wants to be blamed for that. And even if they do all this is just next year, they're going to be right back at it. It's going to be an election year. And then there could be even more interesting to see, you know, where do these candidates weigh in? And then there's always the question on these shutdowns or default things is who's going to get blamed in? Is this defaults? Who's going to get blamed? Before, you know, a couple of weeks ago, you'd probably say Republicans get blamed. But now the Republicans passed a bill. House Republicans, they passed a bill. It cut spending, but it buys another year. I think they have

shifted the pressure onto President Biden and maybe put him back on his heels a little bit because you can't just say I'm not negotiating. I don't think that comes across really good. When Republicans did all his work to pass a bill, it's like you don't like our bill. What's your plan? Right. And so right now, I think the pressure is on Biden. Listeners can keep up with the dead ceiling battle at the center square.com for Casey Harbor. I'm Dan McKeel. Thank you for listening.