House GOP to Senate Democrats: Pass a budget and we’ll raise debt limit

WILLIAMSBURG, Va.—House Republicans will approve a short-term increase of the debt ceiling and in exchange they want a budget resolution from the Democrat-led Senate, a chamber that hasn't passed a traditional budget since the early days of President Barack Obama's first term nearly four years ago. If the Senate fails to pass a budget within three months, House Republicans will withhold their paychecks, said House Majority Leader Eric Cantor on Friday.

"The first step to fixing this problem is to pass a budget that reduces spending. The House has done so and will again. The Democratic Senate has not passed a budget in almost four years, which is unfair to hardworking taxpayers who expect more from their representatives. That ends this year," Cantor said in a statement from the House Republican retreat here on Friday. "We must pay our bills and responsibly budget for our future. Next week, we will authorize a three-month temporary debt limit increase to give the Senate and House time to pass a budget. Furthermore, if the Senate or House fails to pass a budget in that time, members of Congress will not be paid by the American people for failing to do their job. No budget, no pay."

White House press secretary Jay Carney released a statement later Friday reiterating Obama's insistence that Congress pass a "clean" debt-ceiling increase not tied to specific budget cuts or spending demands. But Carney said the White House is "encouraged that there are signs that congressional Republicans may back off on their insistence on holding our economy hostage" to win cuts to domestic programs like Medicare.

The Senate last passed a traditional budget on April 29, 2009, and lawmakers have relied on short-term stopgap measures to fund the federal government's operations since the measure expired. (The House has agreed to its own budget resolutions every year, but none have become law.) In August 2011, Obama signed the Budget Control Act, which the federal government has used as its baseline for allocating funds. The most recent extension of that baseline expires on March 27, 2013.

The Treasury estimates that the federal government's borrowing limit will be breached between mid-February and March, which means Congress needs to raise it so the government can fulfill its financial obligations.

Republicans have used the Senate's failure to pass a budget as a talking point for years, and Democrats have responded by arguing that their obligation was already fulfilled by passing the Budget Control Act.

"In many ways, the Budget Control Act is even more extensive than a traditional budget resolution," read a recent statement from the Senate Budget Committee. "It has the force of law, unlike a budget resolution that never goes to the president. A budget resolution is purely a congressional document; the Budget Control Act is a law."

Senate Majority Leader Harry Reid on Friday responded to the GOP plan by saying he "would be happy to consider" a debt-ceiling increase from the House, but only if it doesn't include extra stipulations.

"If the House can pass a clean debt-ceiling increase to avoid default and allow the United States to meet its existing obligations, we will be happy to consider it," Reid said in a statement. "As President Obama has said, this issue is too important to middle-class families' economic security to use as a ploy for collecting a ransom. We have an obligation to pay the bills we have already incurred—bills for which many House Republicans voted."