20 Sep 2024 BPC Action Applauds Bipartisan Effort Establish a Better Debt Limit Process in Budget and Appropriations

Bipartisan Policy Center Action applauds Reps. Bill Huizenga (R-MI) and Scott Peters (D-CA) for reintroducing the Responsible Budgeting Act to revamp how the debt limit is addressed. If enacted, this reform would avoid debt limit brinkmanship, and instead produce a recurring, structured process focused on fiscal responsibility. 

“This thoughtful solution—which aligns with longstanding Bipartisan Policy Center recommendations—is a strong and effective option to reform the debt limit process,” says Michele Stockwell, president of BPC Action. “By providing lawmakers an opportunity for regular, substantive legislative debate and consideration of debt reduction proposals, it puts the focus back on driving bipartisan, fiscally responsible outcomes while ensuring the debt limit never threatens our economy again.” 

The Responsible Budgeting Act would reform the process for increasing the debt limit to de-escalate negotiations and protect our economy from the resulting uncertainty in two ways.  

• If Congress passes a fiscally responsible budget resolution that reduces the federal deficit over 10 years, it would automatically generate separate legislation to increase the debt limit through the end of the following fiscal year. Only the president’s signature would be required for that increase to go into effect. 

• If Congress has not acted on a budget resolution that meets the threshold by its statutory deadline of April 15, or if the debt limit is close to being reached, the president would be granted the authority to request an increase through the following fiscal year, which would go into effect unless Congress passes a resolution of disapproval within 30 days. The president’s debt limit request to Congress would be accompanied by a debt reduction proposal that reduces the federal deficit over 10 years. This proposal—on a separate track from the debt limit increase—would set off an automatic procedure for debate and consideration of a floor vote on a debt reduction bill. During this process, Congress could offer alternative debt reduction proposals for a vote.  

Nothing would prevent Congress from addressing the debt limit through regular order, as the Responsible Budgeting Act keeps the power of legislating in Congress’s hands. It provides a guaranteed, structured, and non-risky venue for debate over policy options to address fiscal responsibility—an issue that perennially gets overshadowed by increasingly frequent negotiations on the brink of government shutdowns and debt defaults. 

BPC Action commends this bipartisan effort and stands ready to help get this legislation enacted into law.