WASHINGTON (Reuters) – Moderate Republican Representative Brian Fitzpatrick will join Democratic Representative Josh Gottheimer in a bipartisan group on Thursday to propose a new solution to the federal debt ceiling. The current debt limit of $31.4 trillion will be replaced from an absolute amount to a percentage of gross domestic product (GDP).
The federal government reached its maximum borrowing limit on Monday, prompting the Treasury Department to implement special measures to temporarily raise funds. The ministry warned that even with the special measures, the financial resources would have been exhausted by the beginning of June and the debt could not be paid.
President Biden has previously said he would not discuss raising the limit, but on Wednesday said he would discuss it with Republican House Speaker McCarthy.
Under these circumstances, Fitzpatrick told Fox News that although McCarthy will lead negotiations with the White House over the debt ceiling, he will also work with Gottheimer and others to “flesh out” the new proposal. He said it was underway. “We are trying to present a bridgeable solution,” he said.
According to Fitzpatrick, the government is currently working on a mechanism that will force a cut in the size of the federal budget if the debt of the federal government exceeds a certain level as a percentage of GDP. No specific ratio was specified.
