Top Senate Budget Committee Republican Lindsey Graham said Thursday he'd push to condition an increase or suspension of the statutory debt ceiling later this year on unspecified "structural reforms," including potentially withholding lawmaker pay until a budget blueprint is adopted.
Without action on the debt ceiling, once the Treasury runs out of cash and extraordinary accounting measures it could only finance U.S. government obligations out of any incoming daily revenue, meaning important benefits might not go out and interest payments to bondholders could be delayed.
“This is an opportunity to come up with some reforms that will structurally change our debt problem,” the South Carolina Republican told reporters. “But I want to be responsible about it. I mean, we're not going to play chicken here.”
Treasury Secretary Janet Yellen warned last week that Congress might have to raise the debt limit before the August recess as the government could run out of borrowing room during the summer.
The current debt limit suspension expires July 31. Unless Congress raises or suspends the debt limit before the expiration, the Treasury would then implement bookkeeping maneuvers that provide temporary borrowing room. Analysts project the extraordinary measures would last into the last three months of the year, but they are not ruling out the possibility of an earlier exhaustion.
Graham mentioned another run at “no budget, no pay” for lawmakers as a possibility. "[Sen. Ted Cruz, R-Texas] has a few good ideas, you know, ‘no budget, no pay,’ things that make us be more responsible,” he said.
In 2013, a Republican-controlled House and Democrat-controlled Senate passed a debt limit suspension that included a provision to temporarily deny compensation to lawmakers in the House or Senate if they did not adopt a budget resolution by the statutory deadline of April 15. Both chambers adopted their own budget resolution in March, preventing the salary hold from taking effect.
Graham, however, may have in mind a more recent proposal that would deny members pay if they don’t pass appropriations bills in time.
In December 2020, a handful of senators and representatives signed a letter to leadership spearheaded by Sen. Rick Scott, R-Fla., urging them to include a provision in year-end spending legislation to withhold paychecks from lawmakers if appropriations bills are not passed.
The provision was included in broader legislation the Homeland Security and Governmental Affairs panel approved in November 2019. It would have kept lawmaker salaries on ice while the federal government was operating under a stopgap funding bill, in the absence of regular appropriations bills that are ordinarily due Oct. 1 each year.
Cruz was among the signers on Scott's letter, which also included a Democrat, Arizona Sen. Kyrsten Sinema. Similar legislation in the last Congress was coauthored by Sens. Mike Braun, an Indiana Republican, and Joe Manchin III, a West Virginia Democrat.
Their bill, which would have withheld member pay after Oct. 1 until a budget resolution is adopted and appropriations bills passed, attracted support from three other Democrats: Sinema, Nevada's Jacky Rosen and New Hampshire's Maggie Hassan. Hassan is facing a potentially tough reelection fight next year with GOP Gov. Chris Sununu and former Sen. Kelly Ayotte, R-N.H., whom Hassan narrowly defeated, considering challenges.
“I don't think it's too much to ask to say, can we make some structural reforms?” Graham said. “Like how we appropriate. I’m not asking, you know, to fix Medicare.”
Graham’s approach is also in line with a nonbinding rule adopted by the Senate GOP conference last month that would require any increase in the debt limit to be offset with corresponding spending cuts or "structural reforms" in federal spending. Cruz and Scott wrote that amendment to the GOP rules.
Raising or suspending the debt limit would take 60 votes in the Senate. But Democrats also could get around GOP efforts to put strings on debt ceiling legislation through budget reconciliation, which requires a simple majority in the Senate. They'd first need to adopt a new budget resolution, which also takes a simple majority vote.
Lindsey McPherson contributed to this report.