Federal borrowing has reached the statutory debt limit, yet Treasury has another five or six months of “extraordinary measures” until the real deadline in June or July. The federal government must avoid default this year while ending the debt accumulation’s march toward slower growth, fiscal crisis, and global instability.
Closely divided government means a debt limit deal must build from pieces that already have – or should have – broad, bipartisan support. It is an opportunity to forge consensus on sustainable solutions to perennial problems.
An attractive deal could have four parts:
- Automatically suspend the debt limit as Rep. Boyle has proposed, as long as…
- The budget meets reasonable budget targets. For example, Sen. Braun and Rep. Emmer’s Responsible Budget Targets Act would create a glide path over a decade or so to balancing the current services budget (excluding interest) over the medium term, not every year. It resembles highly successful and popular fiscal goals in Switzerland and Sweden, which balance all aspects of sound budgeting: economic and policy stability in the near term, fiscal responsibility for the medium and long term, and emergency response without being a budget loophole.
- An end to shutdown brinkmanship. Congress never intended them to be possible, and it’s time to prevent shutdowns as Sens. Lankford and Hassan have proposed so current policies continue until Congress finishes the budget and appropriations process.
- Separate commissions to protect Social Security and Medicare from insolvency. Sens. Romney, Manchin, and King with Reps. Gallagher, Case, Womack, and Peters proposed the Time to Rescue United States Trusts (TRUST) Act. It would create a bipartisan, bicameral select committee for each major, endangered trust fund program, and each committee would need a majority including at least two members of each party to report recommendations.
AFP’s Dear Congress campaign calls on lawmakers to solve problems for the American people throughout the 118th Congress. Congress should enact a good debt limit deal with broad support that takes a major step toward fixing the broken federal budget system.
Read more:
- Kurt Couchman, “A debt limit deal with something for everyone,” The Hill, November 20, 2022
- Americans for Prosperity, “Senate Right to Prioritize TRUST Act,” July 23, 2020
- Committee for a Responsible Federal Budget, “Explaining the TRUST Act: Just the FAQs,” July 28, 2020