Preliminary List of Legislative Priorities for the 119^th Congress

Debt Ceiling:  In December 2021, Congress voted to increase the debt limit, the maximum amount of money that the U.S. can borrow to meet its legal obligations, to $31.4 trillion.  The Treasury hit that limit in early 2023.  The bipartisan Fiscal Responsibility Act, passed by Congress in June 2023, suspended the debt limit through January 1, 2025.  So as of the 1^st of this year, the Treasury Department will begin paying government obligations by drawing down on its stockpile of cash, and it also will start to deploy “extraordinary measures” to extend the duration of that cash buffer.  In the spring, Treasury will get some relief in this endeavor when it receives a big influx of cash from individual tax payments.  It is estimated that the “X-date,” the point at which Treasury is no longer able to meet its obligations, will arrive sometime mid-year.  Congress will have to increase or suspend the debt limit by that date in order to prevent default.

President-elect Trump had pushed hard for Congress to increase the debt ceiling, or terminate the limit entirely, before he assumes office.  Republicans resisted President Trump’s demand to include such provision in the government spending bill passed just before Congress recessed in December, and it is difficult to imagine any scenario where the debt ceiling will be increased before January 20^th.

Congress has two options to enact the increase:

1. One way would be via a party-line vote using the budget reconciliation process.  A number of congressional Republicans would resist that approach unless it is paired with huge spending cuts.  Speaker Johnson has suggested that in exchange for increasing the debt ceiling by $1.5 trillion, he will look for $2.5 trillion in cuts to mandatory spending, which includes money for Social Security, Medicaid, and Medicare.  However, President Trump has ruled out any cuts to Social Security and Medicare, the two largest components of mandatory spending.  Compounding the political difficulty of this approach, any reconciliation bill would be expected to include spending on other items, potentially including things like border security and taxes that also would require some revenue offsets.
2. Alternatively, leadership could negotiate a bipartisan bill to increase the debt ceiling, but that approach would require concessions to Democrats that could threaten the survival of the Speaker.

FY 2025 Government Funding: Before recessing in December, Congress passed a continuing resolution to continue funding the federal government through March 14.  Congress must pass a measure by that date to continue funding the government for another temporary period or through the end of the fiscal year (September 30), or the government will shut down.

FY 2025 Budget Resolution: Republicans have two shots at enacting tax and spending bills via the budget reconciliation process, which allows a measure to pass the Senate by a simple majority vote, rather than the 60 vote threshold usually required in that chamber.  Republicans are divided over the best strategy for using the process to enact President-elect Trump’s legislative priorities.  Senate Majority Leader Thune (R-SD) has advocated for a two-bill approach, which would use the FY 2025 budget resolution to pass a reconciliation package in the first months of the new administration limited to border security, defense, and energy issues, followed by enactment of a second reconciliation bill covering FY 2026 later in the year to include tax measures and spending cuts.  The House Freedom Caucus has called for a slight variation on this approach, urging that the first reconciliation bill should be limited to border measures and the second should cover tax and energy matters along with spending cuts.  Both approaches would put an early win on the board for Republicans.  The Chairman of the House Ways and Means Committee wants Congress to move a single reconciliation bill that includes all of these provisions, to provide the maximum amount of leverage to win support for the package within the confines of very narrow Republican congressional majorities.

Congressional Review Act Rule Disapproval Measures: Congressional Republicans have promised aggressive use of a procedure authorized by the Congressional Review Act to disapprove of final rules issued by the Biden administration within a specified period of time, probably dating back to the first week of August 2024.