Biden threatens to veto House GOP bill to raise debt ceiling, slash spending

President Biden on Tuesday threatened to veto legislation being pushed by House Republican leaders that would condition support for raising the debt ceiling on deep spending cuts, calling it “a reckless attempt to extract extreme concessions as a condition for the United States simply paying the bills it has already incurred.”

In a statement officially announcing its opposition to the bill, the White House said: “The President has been clear that he will not accept such attempts at hostage-taking.” It added that “House Republicans must take default off the table and address the debt limit without demands and conditions, just as the Congress did three times during the prior Administration.”

The House Rules Committee is preparing to consider the legislation on Tuesday afternoon. House Speaker Kevin McCarthy (R-Calif.) is angling to bring the package to the floor as early as Wednesday.

The GOP proposal would slash federal spending dramatically and unwind some of Biden’s priorities, including student debt cancellation and efforts to address climate change. In exchange, Republicans would agree to increase the debt ceiling — the statutory cap on how much the U.S. government can borrow to pay its bills.

The so-called Limit, Save, Grow Act of 2023 would cap federal agency spending over the next decade, achieving more than $3 trillion in savings, according to GOP estimates. It also would repeal key climate investments and impose new work requirements on recipients of federal aid, including Medicaid.

In its Statement of Administration Policy, the White House said Biden would veto the legislation if it reaches his desk. It is not headed there in its current form.

Last week, Senate Majority Leader Charles E. Schumer (D-N.Y.) said the bill has “no chance” of making it through his chamber and criticized the McCarthy-backed package as a “partisan wish list masquerading as legislation.”

During a speech Tuesday afternoon to union workers, Biden chastised House Republicans for risking default on the nation’s debts.

“They’re saying if … Biden doesn’t agree with them and agree to all the cuts … they’re going to let the country default on its debt,” he said at a conference in Washington of the North America’s Building Trades Unions.

“I can’t imagine anyone ever thinking of using the debt ceiling as a negotiating wedge,” Biden added. “America is not a deadbeat nation. We pay our bills.”

The White House policy statement sought to spotlight some of the real-world consequences of the bill’s spending reductions.

“This legislation would force severe cuts to education (including for students with disabilities), food safety inspections, rail safety, healthy meals for seniors, research on cancer and other diseases, border security, public safety, and veterans’ medical care,” the statement said.

It also noted that the GOP plan envisions repealing tax credits in the Inflation Reduction Act that the White House said “are leading to hundreds of billions of dollars in private-sector investment in the United States, creating thousands of manufacturing jobs.”

And it said repealing Biden’s student debt-relief plan would affect more than 40 million “hard-working Americans.”

McCarthy is hopeful that House passage of the bill will prompt Biden to negotiate with him directly over conditions for raising the debt limit. So far, Biden has insisted on a clean bill lifting the ceiling and said he would be open to discussing budget priorities after that.

Biden unveiled his budget on March 9. House Republicans have been unable to agree to a budget.

It remains unclear whether McCarthy will be able to cobble together the 218 votes he needs in his chamber to pass the legislation. Republicans only have four votes to spare in the narrowly divided House.

McCarthy has maintained that Republicans hope to avoid the country defaulting on its debt if the ceiling isn’t raised by Congress in the coming weeks. In a speech at the New York Stock Exchange last week, McCarthy sought to blame Biden for the standoff.

The Biden administration repeatedly points out that Republicans raised the debt ceiling three times when Donald Trump was president without any demands for spending cuts. Biden and others also have cited Ronald Reagan and Trump, both of whom insisted that debt limit brinkmanship is reckless.

Tony Romm contributed to this report.