House Republican leaders will present their members with a proposal to raise the debt limit for six weeks without policy conditions, said a congressional aide familiar with the details. The move would lessen the risk of a U.S. default one week from a lapse in borrowing authority.
The proposal wouldn’t end the partial government shutdown as Republicans try to shift the debate back to spending issues, said the aide, who asked for anonymity to discuss strategy.
Under the plan, the Treasury Department wouldn’t be able to use so-called extraordinary measures to further extend borrowing authority, creating a hard six-week limit, said two aides requesting anonymity to discuss the proposal.
House Republicans began meeting at 10 a.m. in the Capitol and Speaker John Boehner is scheduled to speak to reporters at 11 a.m.
President Barack Obama said he would accept a short-term increase in the debt limit without policy conditions and that he would negotiate on broader fiscal and health-care policy after the debt limit is raised and the shutdown ends.
Many Republicans want to tie the debt-limit increase to party priorities such as cuts in entitlement programs such as Social Security and Medicare. Yet to be determined is whether rank-and-file members will agree to the leadership’s proposal.
“The only way I could support that is if we have a deal framework -- a top-line number of cuts that include reforms to entitlements,” Representative John Fleming, a Louisiana Republican, said as he entered the meeting today. “Anything short of that I couldn’t support.”
Treasuries and U.S. stocks declined this month amid the standoff. If the U.S. fails to raise the debt limit by Oct. 17, the government will have $30 billion plus incoming revenue to pay its bills. It would start missing scheduled payments, including benefits, salaries and interest, between Oct. 22 and Oct. 31, according to the Congressional Budget Office.
U.S. Treasury Secretary Jacob J. Lew warned Congress today that “uncertainty” over the debt limit is starting to stress financial markets.
“Trying to time a debt-limit increase to the last minute could be very dangerous,” Lew told the Senate Finance Committee. “If Congress does not act and the U.S. suddenly cannot pay its bills, the repercussions would be serious.”
House Republican leaders and selected committee chairmen are set to meet at the White House at 4:35 p.m. today. Democrats will meet with Obama at 1:45 p.m.