House Votes on ‘Clean’ Debt Limit IncreaseFebruary 12, 2014
On Tuesday, Feb. 11, the House voted on an extension of the debit limit—which expired on Feb. 7–one day earlier after leadership opted to move the vote up because of an impending snowstorm on the East Coast. The vote was on a “clean” extension of the $17.2 trillion debt limit until March 2015, since House Speaker John Boehner (R-Ohio) told rank-and-file members that leadership’s latest plan to tie a military pension provision to the extension of the debt limit had failed to win enough support.
The House also voted on a stand-alone measure to repeal a reduction in the cost-of-living pension increases for younger military veterans, paid for by extending sequester cuts to Medicare providers.
Specifically, the Temporary Debt Limit Extension Act (S. 540) suspends the current statutory limit on federal borrowing for one year, through March 15, 2015, which would allow the government to borrow whatever it needs through that time to fully finance government operations. Under the measure, on March 16, 2015, a new statutory debt limit would automatically be re-established and be set at the increased level that reflects the extent to which additional federal borrowing had occurred in order to make payments up to that point on government obligations.
Originally, on Monday, House Republican leaders were hoping to garner support from their Caucus on a one-year extension of the debt limit that would repeal a cut in pensions for younger military veterans and create a new fund for changes in medical payments while offsetting the costs with spending reductions in other mandatory programs in 10 years. Without securing the necessary votes, Speaker Boehner was forced into the “clean” increase, an approach Democrats have been calling for all along.
In October, President Barack Obama signed legislation that ended the 16-day government shutdown and allowed the Treasury Department to sell bills, notes and bonds without exceeding the borrowing cap until Feb. 7, 2014.
On Feb. 7, Treasury Secretary Jack Lew said the extraordinary measures the department is currently undertaking to stave off the need for new borrowing will expire as early as Feb. 27, when the Treasury will be left without $50 billion on hand. That may leave Treasury exposed to potential default on payments. He urged Congress to act without further delay to increase the debt ceiling.
The Senate could vote on a bill to extend the nation’s debt ceiling today, just in time to wrap up for the Democratic Caucus retreat and the President’s Day recess next week.