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Conservatives lay out debt limit demands as House Republicans split on strategy

The plan involves undoing much of President Biden's Inflation Reduction Act. It's not clear it has the votes in the GOP-led House, and even if it does it's a nonstarter in the Senate.
House Freedom Caucus Chairman Rep. Scott Perry, R-Pa.,  during a news conference on the debt limit negotiations at the Capitol on March 10, 2023.
Rep. Scott Perry, R-Pa., released the House Freedom Caucus' demands to raise the debt limit on Friday.Anna Moneymaker / Getty Images

WASHINGTON — A group of ultraconservative House Republicans on Friday sketched out their demands to tackle the debt ceiling, pushing to repeal much of President Joe Biden's signature Inflation Reduction Act and roll back the latest government funding deal.

The plan is highly unlikely to become law, and it represents a major challenge facing GOP Speaker Kevin McCarthy: unifying a conference that is divided on strategy in the face of a looming deadline to avert an economically calamitous default.

The Freedom Caucus, chaired by Rep. Scott Perry, R-Pa., proposed nixing Biden’s $400 billion in student debt relief; rescinding unspent Covid-19 funds; cutting the climate change funding and $80 billion for added IRS enforcement under the Inflation Reduction Act; and capping discretionary spending at fiscal 2022 levels for a decade.

Perry estimated that would save about $3 trillion over a decade. The group said in a one-page plan it would "consider voting to raise the debt ceiling contingent upon the enactment of legislation" that would achieve the above, along with passage of deregulation bills like the REINS Act and adding work requirements for welfare.

But the Republicans gave no indication they would write their own bill representing the Freedom Caucus vision, raising questions about whether their effort will get off the ground. Perry said the ideas have already been unveiled in various bills.

The Freedom Caucus plan represents the views of the most right-leaning House members. It's far from clear McCarthy would endorse the plan, let alone find the votes to pass it under the slim Republican majority. And if he does, it would be dead on arrival in the Democratic-led Senate and under Biden's veto pen.

The Treasury Department has said that Congress has until June 5 to avoid a debt default that would have catastrophic consequences for the U.S. economy. The Congressional Budget Office projects the deadline to be between July and September.

Asked about the unlikelihood of McCarthy getting the support to pass the Freedom Caucus plan, Perry said: "Well look, that's his job. Not mine."

Rep. Scott Perry, R-Pa., center, and members of the House Freedom Caucus announcing their debt limit proposal Friday.
Rep. Scott Perry, R-Pa., center, and members of the House Freedom Caucus announcing their debt limit proposal Friday. J. Scott Applewhite / AP

Perry didn't say how much Congress should raise the debt ceiling by, if it were to adopt his plan: "I don't know what it should be. Here again, I'm not the one requesting a debt ceiling increase."House Republicans are split about the way forward. Some want party leadership to craft a GOP debt limit plan and pass it through the House. Among them is Rep. Ralph Norman, R-S.C., who vowed that "we're going to get" the 218 votes to pass a conservative plan. But others want to pre-negotiate a bill with Democrats, who have demanded a "clean" debt ceiling increase with no strings attached.

"This is extreme on steroids. This would slash and burn our economy," Rep. Brendan Boyle, D-Pa., the ranking member of the Budget Committee, said of the Freedom Caucus proposal. "It shows just how remarkably unserious and extreme their agenda is."

Biden blasted the Freedom Caucus plan on Friday, saying it would amount to cutting “all spending other than defense by 25%.”

“That means cops, firefighters; it means health care. ... They want to make sure we don’t have enough IRS agents," Biden said, adding those agents are needed to "check on the accounts of the super-wealthy."

"We just have a very different value set,” the president said.

On Wednesday, McCarthy gave no indication that he intends to write or pass a GOP debt limit bill when asked if that's his plan. “I expect to get a debt limit increase that changes our funding that gets through the House and the Senate,” he said, indicating he wants Democrats on board before holding a vote.

“You have to have the president on board,” he said. “You got to have the Senate. You got to have everybody.”

Perry acknowledged that McCarthy has a difficult task.

“He’s got to try and navigate what the president wants,” Perry said. “Obviously, the president’s marker is way in the stratosphere. I’m not saying it’s easy to get to an agreement. But if he, if the speaker wants me to go negotiate with the president, I’d be happy to do it. But he’s going to figure that out. And then we’ll determine whether that’s good or bad.”

At a news conference Friday unveiling the plan, Perry dismissed the possibility that McCarthy would strike a deal with Democrats that leaves out the Freedom Caucus.

“Speaker McCarthy is not going to cut a deal with Democrats,” he told reporters with a chuckle.

Rep. Anna Paulina Luna, R-Fla., a Freedom Caucus member who attended the news conference, chimed in: “He has a backbone.”

Afterward, Perry said there has been no talk of overthrowing McCarthy if he puts forward a clean debt limit increase that is free of policy conditions like spending cuts.

"We're not talking about the motion to vacate right now," he said.