On Tuesday, the chairman of the Senate Budget Committee complained that the emerging package would not “fundamentally change” the alarming rate of growth in the national debt and that it falls far short of the savings needed to avert a debt crisis.
“A $2 trillion package sounds big, but I think most serious observers would tell you that it takes a package of at least $4 trillion to fundamentally change the trajectory we’re on,” Sen. Kent Conrad (D-N.D.) told reporters. “In the context of our debt, which is nearly $15 trillion and is headed for $25 trillion, $2 trillion over 10 years does not do the job.”
Bipartisan negotiators led by Biden are rushing to draft a debt-reduction package to persuade reluctant lawmakers to raise the legal limit on government borrowing, now set at $14.3 trillion. Without additional borrowing authority, the government could default on its obligations starting Aug. 2. The White House and congressional leaders hope to raise the limit by just over $2 trillion to pay the bills through the end of next year.
Conrad said he would agree to raise the debt limit for no longer than six months without a more serious effort to reduce future borrowing. And he told reporters that he is recruiting like-minded senators to “send a very clear message that some of us are not going to vote for a long-term extension of the debt limit unless there is a credible plan” to reduce borrowing.
Conrad has long been a leader on budget issues and a determined champion of debt reduction. Last year, he organized a protest of more than a dozen senators that held up the last major increase in the debt limit until President Obama agreed to appoint a fiscal commission to develop a plan to stabilize the debt.
That commission produced a plan that would limit borrowing to a little over $5 trillion over the next decade. The framework under consideration in the Biden talks is likely to require more than $7 trillion in additional borrowing.
Conrad and five other senators, from both parties, had been trying to advance the fiscal commission’s plan, but that effort stalled after Sen. Tom Coburn (R-Okla.) left the group, saying its members were unable to agree on sharp cuts to benefits for retirees.
The remaining members are trying to decide whether to press their case despite opposition from leaders in both parties. So far, few have been willing to support Conrad’s stance. Even some like-minded lawmakers say negotiating $4 trillion in savings is virtually impossible before the Aug. 2 deadline.
“I think it’s too big of a lift,” said House Minority Whip Steny H. Hoyer (D-Md.). “I believe we need a comprehensive approach to this. But in the present time frame, that’s not possible.”
Hoyer said that “the majority of members of Congress understand that the debt-limit package will not end the necessity to act to confront the nation’s fiscal crisis.”
But Conrad argued that all incentive will be lost once the debt ceiling is raised.
“If they reach an agreement and that passes and the debt limit then does not have to be dealt with until after next year’s election, there will be very little appetite here to come back and do what really has to be done to get our financial house in order,” he said.
Conrad suggested raising the debt limit for a shorter period to give policymakers more time to tackle far-reaching overhauls of the tax code, as well as Social Security and Medicare, the biggest drivers of future debt. But Senate Majority Leader Harry M. Reid (D-Nev.) and House Majority Leader Eric Cantor (R-Va.) both rejected that idea Tuesday.
House Republican leaders say it would be extraordinarily difficult to persuade their skeptical troops to vote more than once for a debt-limit increase. And, Cantor said, the job of reducing the debt wouldn’t get any easier after a delay.
“I don’t see how multiple votes on a debt-ceiling increase can help get us to where we want to go,” Cantor told reporters. “We want big reforms. We want big spending cuts and big changes to how this town works. ... If we can’t make the tough decisions now, why would we be making those tough decisions later?”