McCarthy’s Strong Start Faces New Test with Debt Limit Fight

AMAC Exclusive – By Louis J. Senn

After initially struggling to rally the new GOP House majority behind him, Republican Speaker Kevin McCarthy is off to a strong start in his first year, delivering on a number of key campaign promises to conservatives. But with more important legislative battles looming – most notably the intensifying debt limit fight – McCarthy has a number of major tests ahead.

Almost immediately after securing the votes necessary to become Speaker, McCarthy fulfilled key campaign pledges by launching a number of investigations into issues Democrats had neglected – or covered up – while they were in the majority. In the span of just a few weeks, those investigations secured an admission from Biden’s border patrol chief that the administration’s policy is to blame for the unprecedented surge in illegal crossings; laid bare the dishonesty of the Democrat January 6 Committee; established a new panel on strategic competition with China, revealed that Dr. Fauci lied about his knowledge of the lab leak theory, and began to expose the abuses of the left’s censorship regime.

In addition to investigations, McCarthy has also ushered a number of bills through the House that, while they stand little chance of passing the Democrat-controlled Senate, make clear to voters where the GOP stands on issues and present a contrast in leadership and priorities. Some notable successes include H.R. 1, a bill that lowers energy costs and addresses Biden’s destruction of American energy independence, and a parental bill of rights.

McCarthy also led the charge to kill the D.C. City Council’s overhaul of the capital city’s criminal code via a joint resolution – an effort that was ultimately successful when President Biden signed the resolution. Along with energizing Republicans, the episode exposed deep divides among congressional Democrats over the left’s so-called “criminal justice reform” agenda.

Despite these important successes, however, McCarthy’s most important test to date is likely the ongoing debt ceiling battle, which has started to heat up in recent weeks as the country approaches its borrowing limit, expected to happen sometime between July and September. If the limit is not raised and the United States defaults on its debts, it would have catastrophic implications for both the U.S. and global economy.

After Biden and congressional Democrats spent $4.2 trillion over two years of unified government, however, the country is in a precarious financial position. Inflation remains above 6 percent (more than three times the Fed’s target rate of 2 percent) and many economists have continued to warn about a banking crisis and prolonged recession in the near future.

It is against this backdrop that McCarthy has begun engaging with the Biden administration on raising the debt ceiling. The White House and congressional Democrats want to raise the borrowing limit yet again with no measures to reduce spending – likely exacerbating inflation and economic uncertainty even further.

McCarthy and Republicans, meanwhile, have proposed a bill titled the Limit, Save, Grow Act which raises the limit to avoid a default, but couples it with practical spending reductions to get inflation under control. House Republicans are expected to vote on the measure this week.

But thus far, the White House has refused to play ball with McCarthy. Biden met with McCarthy on February 1 to discuss the debt ceiling, but has refused all offers to negotiate since then. In late March, after nearly two months of Biden refusing to meet with him, McCarthy sent a letter to the president declaring, “Mr. President, simply put: you are on the clock. It’s time to drop the partisanship.”

Meanwhile, the White House has deliberately mischaracterized the Republican position, apparently expecting that the mainstream media will take their version of events at face value and turn public opinion against McCarthy. For instance, of a Republican proposal to raise work requirements for individuals on welfare from 20 hours to 30 hours per week, Biden accused Republicans of “cutting benefits.”

But even some Democrats aren’t buying it. Last week, Senator Joe Manchin (D-WV) stated, “It has been more than 78 days since President Biden last met with Speaker McCarthy. This signals a deficiency of leadership, and it must change.” He went on to thank McCarthy for putting a proposal together and blasted Biden for not suggesting anything. Finally, he pleaded with the White House not to cater to the extreme elements of the Democrat Party and instead focus on helping all Americans.

As McCarthy noted, “American debt is a ticking time bomb that will detonate unless we take serious, responsible action.” Now, with Biden appearing unwilling to negotiate and congressional Democrats divided, it looks as if it will be up to McCarthy to prove his leadership skills once again and defuse that bomb before it’s too late.

Louis J. Senn is a lawyer in Louisville, Kentucky who previously worked for the Trump Administration.