House Speaker John Boehner, R-Ohio, will not allow an increase in the debt ceiling to move through the House unless the amount of the increase includes an equal or greater amount of spending cuts.
His pledge, to be announced Tuesday at a Washington fiscal summit, once again sets Congress on a collision course with Senate Democrats and the White House over what was once a routine vote to raise the federal debt ceiling, which allows the U.S. government to continue to pay its bills without the risk of default.
“When the time comes, I will again insist on my simple principle of cuts and reforms greater than the debt limit increase,” Boehner will say at the Peter G. Peterson Foundation’s 2012 fiscal summit. “This is the only avenue I see right now to force the elected leadership of this country to solve our structural fiscal imbalance.”
Last summer, Republicans held the White House to the same standard in a show of brinksmanship that led to an 11th-hour deal, which included a plan to appoint a special panel to find $1.2 trillion in deficit reduction. The panel failed to come up with the savings, triggering automatic across-the-board cuts split between defense and non-defense cuts that Congress is currently scrambling to head off before they kick in next January.
Last week the GOP-controlled House offered a budget proposal to turn off the cuts for one year and replace the cuts to defense spending with cuts to domestic programs. Democrats do not oppose efforts to rework the deficit reduction deal but continue to insist that it include new tax revenue.
Congress is still grappling with the unintended consequences of the last debt ceiling showdown, but Boehner suggests that Republicans will not force the same brinksmanship, and could offer “a series of stop-gap measures” to raise the debt ceiling in order to negotiate a spending cuts package.
The debt ceiling vote is currently expected after Election Day, further ensuring a consequential lame duck session in which Congress will also have to address how to rework the across-the-board cuts set to begin Jan. 2, the Dec. 31 expiration of the Bush tax cuts and an expiration of a tax package that includes a payroll tax break and unemployment insurance benefits affecting millions of American workers.
Boehner also said the House will vote to extend the Bush tax cuts before the election, putting the chamber on record ahead of the lame duck negotiations. Their tax bill will also include instructions to expedite a broader overhaul of the tax code in 2013. “The bottom line is: if we do this right, this will be the last time we ever have to confront the uncertainty of expiring tax rates,” he will say, according to excerpts.
At the same summit, Treasury Secretary Timothy Geithner said he did not support Boehner’s effort to relive last summer’s debt ceiling showdown, saying he was hopeful Washington could deal with the debt ceiling increasing “without the drama and the pain and the damage [Republicans] caused the country.”
The two parties’ bargaining positions will be directly affected by the outcome of the 2012 elections, particularly if either the House, Senate or the White House switches parties. House Republicans are currently projected to hold on the House, which they currently control 242-190, but are likely to lose seats according to election forecasters.