|Sponsor||Rep. Reed, Tom|
|Committee||Ways and Means|
|Date||January 18, 2012 (112th Congress, 2nd Session)|
|Staff Contact||Andy Koenig|
On Wednesday, January 18, 2012, the House is scheduled to consider H.J.Res. 98, a joint resolution relating to the disapproval of the president’s exercise of authority to increase the debt limit. Under the provisions of S. 365, the Budget Control Act, all points of order against the joint resolution and its consideration are waived and no amendments to the joint resolution are in order. H.J.Res. 98 was introduced by Rep. Tom Reed (R-NY) on January 13, 2012, and the resolution was referred to the House Committee on Ways and Means.
H.J.Res. 98 would resolve that Congress disapproves the president’s use of his authority to increase the debt limit by $1.2 trillion, from $15.194 trillion to $16.394 trillion.
Pursuant to the Budget Control Act (S. 365, P.L. 112-25), the president is authorized to submit a written certification to Congress when the national debt is within $100 billion of the debt limit. If a resolution disapproving of the debt limit increase is not enacted within 15 days of the certification, the debt limit would be increased by $1.2 trillion. The president sent the certification to Congress on January 12, 2012. If enacted, H.J.Res. 98 would prohibit the $1.2 trillion statutory debt limit increase. This increase would automatically occur unless this resolution is approved by the House and the Senate and signed by the president (or the president’s veto is overridden). If H.J.Res. 98 is not enacted, this would be the final debt limit increase authorized under the Budget Control Act.
On August 1, 2011, the House approved an amended version of S. 365, known as the Budget Control Act (BCA), by a vote of 269-161. The BCA was signed by the president and enacted the following day. The BCA provided for a debt limit increase between $2.1 trillion and $2.4 trillion (depending on deficit reduction achieved) in three tranches, created discretionary spending caps to cut spending over the next ten years, and established a Joint Committee to produce deficit reduction legislation. The first increase in the statutory debt limit authorized by the BCA was $400 billion which occurred upon the bill’s enactment. The second debt limit increase of $500 billion was subject to a congressional disapproval process and occurred on September 22, 2012, as a disapproval measure (H.J.Res. 77) only passed the House. On January 12, 2012, the president sent a certification to Congress indicating that the debt subject to the statutory limit was within $100 billion of the debt limit. Under the BCA, if a resolution of disapproval is not approved by the House and Senate and enacted within 15 calendar days (January 27) the debt limit will increase by $1.2 trillion, to $16.394 trillion. This would be the final debt limit increase authorized under the BCA and, when combined with the previous debt limit increases, would provide for a total debt limit increase of $2.1 trillion under the BCA.
The BCA stipulates that when the president submits the final certification that the national debt is within $100 billion of the statutory limit, the Secretary of Treasury is authorized to increase the debt limit by a total of $1.2 trillion. That certification was submitted by the president on January 12, 2012. The amount of the final debt limit increase could have been raised to $1.5 trillion if a balanced budget amendment (BBA) were sent to the states for ratification or legislation was produced by the Joint Select Committee on Deficit Reduction and produced deficit reduction of $1.5 trillion or more. If the president is able to increase the debt limit by $1.2 trillion (contingent upon the congressional disapproval process), since deficit reductions were not proposed by the Joint Committee, then an additional spending sequester is triggered to ensure that the second debt limit increase is offset dollar-for-dollar with spending cuts. Since legislation was not proposed by the Joint Committee, a sequestration process will take effect in order to reduce discretionary and mandatory spending by $1.2 trillion. The BCA set January 15, 2012 as the deadline for the Congress to pass, and the President to sign, legislation from the Joint Select Committee on Deficit Reduction. Since this deadline was not met the $1.2 trillion sequestration will be scheduled to take effect over the 2013-2021 period. However, no spending cuts will actually be implemented until 2013.
On August 2, 2011, President Obama submitted a certification that the debt was within $100 billion of its limit and the debt limit was increased by $400 billion, from $14.294 trillion to $14.694 trillion. An additional $500 billion increase occurred on September 22, 2011, since a resolution of disapproval was not enacted. Following the $500 billion increase, the statutory debt limit stands at $15.194 trillion. The final $1.2 trillion increase will take effect on January 27 barring enactment of a final resolution of disapproval. Under the BCA, the final resolution of disapproval of the debt limit increase will be considered under an expedited procedure. The expedited process for consideration of the resolution provides for the following procedures:
On September 7, 2011, the Senate voted 45-52 to reject a motion to proceed to a Senate resolution of disapproval, S.J. Res 25, which had been introduced by Senate Minority Leader Mitch McConnell (R-KY).
A CBO cost estimate of H.J.Res. 98 was not available as of press time.