St. Paul Reporter

House passes DOA bill that threatens to default on existing debt obligations unless GOP's vague but dangerous demands are met

WASHINGTON, D.C. — Congresswoman Betty McCollum (MN-04) released the following statement today after voting no on Speaker McCarthy’s Default on America Act (Limit, Save, Grow Act):

“Since 1960, Congress has acted to raise the debt ceiling 49 times under Republican presidents and 29 times under Democratic presidents. We have always paid America’s bills on time. Now with the Default on America Act, House Republicans are willing to risk the full faith and credit of the United States. This hurts our national economy, leading to higher mortgage rates and car payments, and undermining Americans’ retirement security. Threatening to default on our existing debt obligations as a bargaining chip is fiscally irresponsible. This bill is a ransom note demanding deep cuts that will hurtAmericans across the country and jeopardize our economic recovery—all while protecting billionaires and big corporations from paying their fair share in taxes.

“My fellow House Democrats and I are ready to act now to prevent a default on our debt, continue our historic deficit reduction, and responsibly invest in America to lower costs and create better paying jobs. It is time for extreme Republicans to stop the political games and join us to protect our economy.”

Background: The Default on America Act would cap FY24 discretionary spending at FY22 levels (a cut of at least $142 billion from FY23 levels) and cap discretionary spending increases at 1% per year through FY33.

According to a new Joint Economic Committee report, in Minnesota’s Fourth District alone, the impact of the Default on America Act would be profound:

Cutting Support Programs for People When They Most Need Help

The GOP plan would kick vulnerable families in MN-04 off food and health programs when they can least afford it. The 37,000 families in MN-04 who get SNAP benefits and the roughly 194,000 people on Medicaid would face a mountain of paperwork just to keep their benefits. The 11,000 families in MN-04 below the poverty level will shoulder much of the burden of the broad budget cuts targeting safety net programs. This hurts families and the communities they live in.

Threatening Health Benefits for Veterans Across-the-board cuts jeopardize funding for Veterans Affairs health benefits that support the 25,000 veterans in MN-04. This can cause delayed care and missed appointments that worsen health outcomes for our nation’s veterans.

Slashing Education Funding That Invests in Our Children’s Future Republicans’ budget cuts hurt the 120,000 K-12 students in MN-04 when federal funds for education are cut.

Shrinking Housing Support Programs That Are Already Underfunded 

There are 43,000 households in MN-04 that spend more than 30% of their income on rent. Many of these renters include low-income families who are eligible for rental assistance. Unfortunately, federal housing assistance only has enough funding for one in four eligible families, and Republicans want to cut this program even more.

Eliminating Programs That Would Create Jobs, Lower Costs, and Make the Wealthy Pay Their Fair Share 

On top of these across-the-board cuts, the GOP plan would also:

• Stifle billions of dollars in investments in green technologies that support good-paying jobs,
• Roll back home energy tax credits that lower costs and protect our planet, and
• Stop the IRS from pursuing wealthy tax cheats who don’t pay their fair share.

Prioritizing corporate profits and big oil over protecting everyday Americans from the climate crisis This bill includes House Republicans H.R. 1, the Polluters Over People Act, which would undermine critical environmental protections and worsen the climate crisis by:

• Eviscerating bedrock environmental protections that safeguard public health and keep our air and water clean.
• Ensuring that we will continue to burn more fossil fuels instead of tackling the worsening climate crisis.
• Repealing landmark green energy programs that would cut domestic greenhouse emissions

Making it easier for the wealthy to not pay their taxes 

The GOP wants to get rid of additional funding that helps the IRS make sure the wealthiest Americans pay their fair share in taxes. This increased scrutiny does not apply to families earning under $400,000, and instead focuses on the complex financial arrangements used by the rich to hide their wealth.

These are just some of the ways that the GOP’s reckless plan will harm real people in MN-04. Instead of going down this disastrous path, House Republicans should join Democrats in avoiding default and passing a clean debt limit bill like they did three times under the last president.

More information can be found at https://democrats-budget.house.gov/legislation/defaultonamerica.

Original source can be found here.