WASHINGTON — Republicans, newly empowered with a House majority, are demanding spending cuts as a price for lifting the debt ceiling and averting a catastrophic default on U.S. debt.
But they’re struggling to identify what to cut, complicating Speaker Kevin McCarthy’s task of passing a bill with his narrow majority.
“There’s gotta be cuts in spending. That has to happen,” said Rep. Marjorie Taylor Greene, R-Ga., an ally of McCarthy, R-Calif., and the far right.
But she declined to get specific when she was asked what should be cut.
“I haven’t really formulated an exact list,” she said.
Republicans are divided over whether Medicare and Social Security spending should be on the chopping block. They’re split over whether military funding should be on the table. They’re firmly opposed to new tax revenues to reduce the debt. They say they’re willing to cut domestic non-defense spending, but that’s a limited slice of the budget pie that wouldn't fulfill many conservatives’ demands to balance the budget.
The looming June 5 deadline set by the Treasury Department presents a potentially career-defining challenge for McCarthy, who must balance a series of competing interests in his slim House majority with the need to ultimately pass a bill through the Democratic-led Senate and gain President Joe Biden’s signature to avert dire economic consequences.
“The first question is what can get out of there with 218 Republican votes,” said Sen. Kevin Cramer, R-N.D., who served with McCarthy in the House. “And that’s Kevin’s challenge.
“We’ll see what they can come up with. The burden of governing — the weight of that burden is starting to be felt by people over there,” Cramer said. “But at the end of the day, we’d rather have our fingerprint on a success than failure. That’s my hope. And I think Kevin should be given a lot of time and room to do that.”
Failure to act in time could mean a stock market crash and a recession, a weaker dollar and higher interest rates and a government forced to make grueling choices, like whether to pay creditors or fund the Defense Department and send out Social Security checks.
House GOP hard-liners, including those who withheld their votes to make McCarthy speaker until they won a series of concessions and promises, are demanding fiscal discipline in the abstract.
“I have said since I first ran that I would not vote for a debt ceiling increase apart from the cuts in spending that would put us on a path to fiscal responsibility,” said Rep. Bob Good, R-Va., who declined to elaborate on what specifically that would look like.
Rep. Ralph Norman, R-S.C., who landed a seat on the powerful Rules Committee, said he wants to see “a downward trajectory” in long-term spending as part of any increase in the debt ceiling.
Rep. Anna Paulina Luna, R-Fla., another of the 20 initial McCarthy holdouts, said a debt limit bill should have an amendment to balance the budget over 10 years to win her vote.
Luna said she wants to do it without tax increases or Social Security or Medicare cuts. “Where there’s a will, there’s a way,” she said.
Experts say that if those programs, as well as Pentagon spending — a sacred cow for many Republicans — are untouched, it becomes practically impossible to balance the budget in a decade.
“If you exempted defense, veterans, Social Security and Medicare spending, you’d have to cut everything else by 85%,” said Marc Goldwein, an expert at the Committee for a Responsible Federal Budget, a think tank that advocates for reducing red ink. “It’s possible as a mathematical proposition. But the question is: Is it possible as a policy proposition? And the answer is no.”
McCarthy hasn’t offered a plan other than to insist on a negotiation with Biden to cut “wasteful spending.”
“What I have asked for is to sit down, let’s find common ground, and let’s eliminate the wasteful spending to protect the hard-working taxpayers and to protect the future of America,” he said.
The White House has vowed that Biden won’t grant concessions on the debt limit and that paying the country’s bills is non-negotiable. That position has the support of Senate Majority Leader Chuck Schumer, D-N.Y., who said Democrats have no intention of engaging until McCarthy shows what specifically can pass the House.
“Until Speaker McCarthy has a plan — and a plan that can pass in the House with his Republican support — his going to the White House is like going with no cards in his hand,” Schumer said. “Show your own caucus the plan and see if you have the votes to pass it.
“We have a plan. Pass the debt ceiling without hostage-taking, without any brinkmanship,” he told reporters Wednesday.
Rep. Patrick McHenry, R-N.C., a McCarthy ally and veteran of past debt limit fights, said the House will most likely have to act first, agreeing with Senate Minority Leader Mitch McConnell, R-Ky. McHenry, now the chairman of the Financial Services Committee, which oversees Wall Street, has urged Republicans to be reasonable in their demands.
At a news conference Wednesday, five of the most conservative GOP senators also sidestepped numerous questions about what spending should be cut to meet their demands of budgetary discipline.
“We need to attach to it fiscal controls or other spending cuts. Exactly what those are we’re not willing to lay out here today,” Sen. Ron Johnson, R-Wis., told reporters. “We’re going to be doing that in consultation with the House.”
Sen. Ted Cruz, R-Texas, said, “It is incumbent on that Republican majority and on Republicans in the Senate to use every leverage point we have to stop the out-of-control spending.”
Some in the GOP have floated measures to manage a potential breach in the debt limit by prioritizing payments. Others say Congress could force lower overall spending levels and give agencies discretion about what to cut. Yet others say committees of jurisdiction should make those decisions.
Rep. Mike Garcia, R-Calif., who represents a competitive district, said Republicans are “working actively right now” to figure out what can get 218 votes in the 222-seat majority.
“That’s part of the challenge we have right now, obviously, with a thin majority. We’ve seen thin majorities before, but the question is what that product looks like that we can get consensus on,” he said.
“I think everything should be on the table. But I think we’ve got to also honor our commitment to Americans when it comes to Social Security and Medicare,” Garcia continued. “Now, that begs the question: Is that enough? Is there enough left to address on the discretionary side?”
Asked what the House will attach to a debt limit increase, Rep. Beth Van Duyne, R-Texas, a member of the Ways and Means Committee, said: “We’re definitely going to have to have some negotiations.”
She said she doesn’t think a no-strings-attached increase can pass.
“I don’t see the support for it,” she said.