Republican leaders in the House of Representatives have scheduled a vote on Wednesday on a nearly four-month extension of U.S. borrowing capacity, but the bill does not specify a dollar amount.
Legislative language released by the House Rules Committee on Monday said the bill aims “to ensure complete and timely payment of the obligations of the United States Government until May 19, 2013.”
The legislation is a strategic move by House Republicans to avoid a fight over the looming federal debt ceiling and shift their negotiating leverage for spending cuts to other fiscal deadlines. The U.S. Treasury expects to exhaust all remaining power to borrow money under the $16.4 trillion debt limit sometime between mid-February or early March.
The strategy shift, agreed last week by House Republicans at a retreat in Williamsburg, Virginia, aims to draw the Democratic-controlled Senate into taking action to cut deficits by requiring the Senate to pass a budget resolution by April 15. The Senate has not passed a budget in nearly four years.
Under the legislation, if either the Senate or House fail to meet the April 15 budget deadline, lawmakers’ salaries would be held in escrow until their chamber passes a budget.
House Speaker John Boehner had referred to this provision as a “no budget, no pay” requirement.
But in order to avoid any constitutional violations, the withheld salaries would be released at the end of the current Congress in January 2015.
The legislation temporarily suspends the debt limit and allows the government to borrow as necessary to meet its obligations, including interest payments, until May 19.
But it is not a blank check for the Treasury – it cannot, for example, borrow extra funds during the suspension period to fund the $1 trillion deficit expected for fiscal 2013. The Treasury can only borrow to fund commitments that require payment before May 19.
The House Rules Committee is scheduled to set conditions for debate on the legislation, including rules for any amendments, at an emergency meeting on Tuesday..
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