The debt ceiling and federal budget debates are unfolding in real-time on Capitol Hill with potentially severe consequences for life in the United States and the health of the global economy.
The debt ceiling and federal budget debates are unfolding in real-time on Capitol Hill with potentially severe consequences for life in the United States and the health of the global economy.
On April 26, the U.S. House passed Speaker Kevin McCarthy’s (CA-20) budget. The Limit, Save, Grow Act of 2023 (H.R. 2811) is a proposal to dramatically cut funding for critical social services, nutrition assistance, health care, and housing assistance.
The legislation would also suppress our peace agenda by limiting funding for violence prevention efforts, international peacebuilding programs, climate change mitigation and adaptation efforts, and many other vital priorities. Overall it contains approximately $3.6 trillion in federal spending cuts over the next decade.
This is not a bill the Speaker believes will pass Congress. Rather it is his opening bid in a protracted negotiation to extract spending cuts in exchange for raising our nation’s borrowing limit. The looming danger of holding hostage the debt ceiling to secure his spending priorities is the catastrophic global economic consequences of default.
This is About Politics, Not Fiscal Responsibility
Some lawmakers claim they are pursuing this approach out of a concern for fiscal responsibility, but this is not about budget deficits. If it were, the budget proposal would reduce federal deficits and debt in a significant way. Instead, it makes draconian cuts to programs that have relatively little impact on overall government spending while allowing the Pentagon budget to continue skyrocketing without scrutiny.
The legislation also fails to ask millionaires, billionaires, and wealthy corporations to pay their fair share of taxes—another significant way that our nation’s debt could be reduced—and cuts existing funding for tax enforcement to pursue wealthy individuals who cheat on their taxes.
The Proposed Cuts Have Real-World Consequences
The impacts of these cuts would be extreme. The administration estimates that in the coming fiscal year alone, it would cause 926,000 households to lose their Housing Choice Vouchers, threatening their access to housing. It would also cut 200,000 kids off Head Start. Up to 2 million people would be disqualified from Medicaid, and nearly one million homebound seniors could lose access to the Meals on Wheels program.
Rather than investing in critical priorities, this budget bill takes the country in the opposite direction.
The bill imposes harsh new regulations on food assistance, health care, and income support. Measures like increased work requirements and red tape will keep people needing assistance the most from accessing it and will force millions of others off these programs.
Finally, it would cut funding for diplomacy and international peacebuilding efforts in USAID and the State Department’s budget and prevent the United States from meaningfully investing in multilateral and bilateral climate programming to address the climate crisis.
These are just a few examples that illustrate the severity of this budget proposal. Rather than investing in critical priorities, this budget bill takes the country in the opposite direction.
Congress Must Avoid Default Without Punishing Our Most Vulnerable Neighbors
One thing is clear: Congress must raise the debt limit. It is wrong to hold the global economy hostage to score partisan points and advance a political agenda.
We’ve been here before. For years our country lived with severe spending cuts and caps that were extracted as part of debt ceiling negotiations of 2011. The result was a hollowing out of vital human needs programs that help children and families to thrive. The social and economic harm of that experiment was deep and long-lasting.
Lawmakers should oppose efforts to impose harsh cuts or overall spending caps and instead invest in the country’s needs.
We must learn the lessons of the past and avoid repeating them here. Lawmakers should oppose efforts to impose harsh cuts or overall spending caps and instead invest in the country’s needs. If Congress is genuinely concerned about reining in federal spending, there are better ways to do it than by slashing some of our most effective poverty-fighting programs. There are savings to be found in the military budget; Billionaires and wealthy corporations could be asked to pay their fair share in taxes.
This budget proposal does neither. Instead, it would punish our most vulnerable neighbors.
