House leaders Monday unveiled legislation to permit the government to continue borrowing money through May 18 to stave off the first default on U.S. obligations. It is slated for a vote Wednesday.
The measure marks a change in strategy for House Republicans, who have backed off demands that any extension of the government’s borrowing authority be accompanied by stiff spending cuts.
The legislation also is aimed at prodding Senate Democrats to pass a budget after almost four years of failing to do so. It would withhold the pay of lawmakers in either House or Senate if their chamber fails to pass a budget this year. House Republicans have passed budgets for two- consecutive years, but the Senate hasn’t passed one since President Barack Obama’s first year in office.
The current debt limit is $16.4 trillion. The legislation does not set a specific limit; rather it automatically would increase the limit by the amount required to fund U.S. government obligations through May 18.
But that date is not a hard deadline, because the Treasury would retain the limited ability to exercise so-called extraordinary measures and juggle certain accounts to buy limited additional time before a default on U.S. obligations. Such steps could buy several additional weeks beyond May 18.