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WASHINGTON —U.S. House Speaker Kevin McCarthy pledged Monday that the narrow Republican majority in the House of Representatives will vote to raise the country's debt ceiling to avert a default on the government's financial obligations in the coming months, but will also stipulate that future spending increases be capped at 1%.
The White House strongly criticized the announcement.
McCarthy, in a speech at the New York Stock Exchange, called the country's nearly $31.7 trillion debt a "ticking time bomb" and assailed Democratic President Joe Biden as "missing in action" in resolving the contentious issue before the government runs out of money to pay its bills, which could be as soon as June.
Any resulting default on the government's financial obligations would be a U.S. first and could roil the world economy, plunge stock values and force widespread layoffs.
Biden and White House officials have called on Congress to approve a debt ceiling increase without conditions, as has often been done in the past, including during Republican administrations. But McCarthy said, "Since the president continues to hide, House Republicans will take action."
McCarthy, who has had trouble in getting his 222-seat majority in the 435-member House to agree on a package of spending cuts to present to Biden, nonetheless told Wall Street leaders that the Republican caucus would pass legislation that would raise the debt ceiling for one year, pushing the issue next year into the midst of the 2024 presidential election campaign.
In addition, McCarthy said Republicans would roll back federal spending to fiscal 2022 levels and curb future spending boosts to no more than 1%. Republicans are also hoping to cut federal spending for social safety net programs for poorer Americans.
The White House, in a statement, said that McCarthy was breaking with the politically bipartisan norm in approving a debt ceiling increase without conditions, as happened twice during former President Donald Trump's tenure. Biden has said he is willing to discuss future spending separately, aside from increasing the debt ceiling to authorize government borrowing to pay debts already incurred.
The White House said the Republican House leader "again failed to clearly outline what House Republicans are proposing and will vote on." The White House contended Republicans would "increase costs for hard-working families, take food assistance and health care away from millions of Americans, and yet would enlarge the deficit when combined with House Republican proposals for tax giveaways skewed to the super-rich, special interests, and profitable companies."
Biden and McCarthy met in early February about the debt ceiling but not since.