McCarthy's Narrow Margin for Losing Support
House Speaker Kevin McCarthy can only afford to lose support from four of the 222 Republican members to pass the bill, which proposes a $1.5 trillion increase in the borrowing limit. However, at least many Republicans withhold support as lawmakers reconvene in Washington.
Bill Faces Resistance in Senate and White House
The proposed legislation faces an uphill battle in the Democratic-controlled Senate and would likely be vetoed by President Joe Biden if it reached his desk. Biden insists that the debt ceiling should be raised without conditions, as was done under his predecessor, Donald Trump.
Republicans Seek Unity to Pressure Biden
Republicans hope a unified stance can force President Biden to negotiate after a months-long deadlock. Emmer believes this is a choice between giving the ball to McCarthy or allowing Biden a blank check.
House Rules Committee Takes Up Bill
The House Rules Committee will consider the bill on Tuesday afternoon, possibly followed by a House floor vote as early as Wednesday. Both Washington and Wall Street are closely watching the approaching "X-date," when the US Treasury may default.
Analysts Warn of Risks from Disunity
Analysts warn that the inability of House Republicans to unite behind a proposal introduces significant risks, as seen during the 2011 debt limit standoff, which led to a downgrade in the US credit rating and increased borrowing costs.
Investors Await New "X-Date" Forecast
Debt markets are already showing signs of concern as investors grow wary. The Treasury Department is expected to offer a new "X-date" forecast in the coming weeks.
Mixed Odds of Passing Legislation
Brian Riedl, a senior fellow at the Manhattan Institute, gives House Republicans a 50-50 chance of passing the legislation this week. Moderate and conservative lawmakers are pushing the bill in competing directions.
Divided Opinions Among Republicans
Some Republicans argue that the proposal does not sufficiently cut the deficit. In contrast, others advocate for stricter work requirements for social programs or express concerns about proposed cuts to renewable-energy tax credits.