Debt limit plan proposed by Kevin McCarthy in Wall Street

Debt — On Monday, House Speaker Kevin McCarthy previewed a plan he hoped House Republicans could pass in the coming weeks.

McCarthy made a speech during the New York Stock Exchange that could raise the debt ceiling, saying:

“So here is our plan: in the coming weeks, the House will vote on the bill to lift the debt ceiling into the next year, save taxpayers trillions of dollars, make us less dependent on China, curb our inflation, all without touching social security and Medicare.

The plan

McCarthy’s proposed plan would serve as a marker of GOP demands in the middle of an impasse as two parties continue to argue on how to resolve the issue.

For now, there is no bipartisan agreement, and Democrats are still arguing that the debt limit should be lifted with no strings attached.

The Republican bill is not expected to pass in the Senate.

According to McCarthy, the GOP’s plan for a one-year debt limit increase would roll back domestic, non-defense spending back to levels seen in 2022.

McCarthy also said they would attempt to pass the GOP plan in the coming weeks.

The crowd

At the New York Stock Exchange, Kevin McCarthy touted the GOP proposal, saying:

“Simply put, it puts us on a fiscally responsible path in three ways: it limits, saves, and it grows.”

The House Speaker’s assurances came as a small group of protestors stood in front of the building, calling him out for plans to cut Medicare funding.

McCarthy repeatedly slammed President Joe Biden, criticizing what he believed was Biden’s unwillingness to negotiate.”

Without exaggeration, American debt is a ticking time bomb that will detonate unless we take serious responsible action,” said McCarthy.

“Yet, how has President Biden reacted to this issue? He has done nothing. So, in my view and I think the rest of America, it’s responsible.”

The White House responds

On Monday, the White House criticized Kevin McCarthy for the GOP demands.

Andrew Bates, the White House deputy press secretary, released a statement, saying McCarthy is “engaging in a dangerous hostage taking.”

Bates also said McCarthy failed to clarify what the House Republicans are proposing and would vote on, arguing that the House Speaker only referenced a vague, extreme MAGA shopping list.

However, White House officials will closely monitor if McCarthy could deliver on his promise: passing a bill in the coming weeks to raise the debt ceiling and curb spending.

A senior White House official said if the House Speaker achieves his plan, Biden would be open to meeting McCarthy.

Read also: Debt Relief Options – What Are Your Options For Debt Relief?

The Republican dilemma

Although he is optimistic, it is a challenge for Kevin McCarthy to get 218 votes, and he can only stand to lose four votes.

“I know there’s a place where we can come to an agreement,” said the House Speaker.

“It’s just hard when people think that there’s not $1 that you can cut out of government spending today.”

Although McCarthy didn’t specify areas that the GOP plan to cut spending, he expressed wishes to tie a GOP energy package called HR-1 to the debt ceiling debate.

The plan passed the House last month.

It is looking to increase American energy production and grow the economy by rolling back on all of President Joe Biden’s climate policy.

Calling out Biden

Kevin McCarthy used quotes from former Vice President Biden regarding the debt crisis of 2011.

“He said, ‘You can’t govern without negotiating.’ Well, what changed, Mr. President? I agree with the former sensible Joe Biden,” he said.

“I agree with the former sensible Joe Biden. He knew that our government is designed to find compromise. I just wish the current extreme Joe Biden would listen to the former Joe Biden.”

The line prompted the only round of applause from the audience throughout his speech.

Recently, the administration reiterated their position in a statement from Andrew Bates, saying:

“There is one responsible solution to the debt limit: addressing it promptly, without brinkmanship or hostage taking – as Republicans did three times in the last administration and as presidents Trump and Reagan argued for in office.”

Kevin McCarthy urged Wall Street to pressure the current administration to undergo spending cuts.

“If you agree, don’t sit back, join us,” said McCarthy.

The House Speaker also said he wasn’t monitoring stock market conditions as he went into debt ceiling negotiations.

“Markets are reacting to work we’ve done, so I shouldn’t be monitoring you,” he told traders.

“I should monitor what we’re doing, and that’s exactly what I do.”

He also noted that markets are going up because the president ignored the markets for 75 days.

However, McCarthy didn’t elaborate on its connection to stocks going higher.

On Monday, markets were trading slightly lower.

McCarthy concluded his speech by invoking the drawn-out speakership battle.

“I will never give up. I will never give up on you, we will not rest until the economy is healthy.”