Conservatives propose compromise of balanced budget, higher debt limit

Conservative Republicans said Wednesday that they will demand that Congress produce a budget that balances in 10 years in exchange for agreeing to raise the federal debt limit, and that House Speaker John A. Boehner promised as much during a GOP retreat this year.

One member of the rump group of conservatives said another option Republican leaders are mulling — to tie a debt increase to a general plan for tax reform — is “nonsensical.” Rep. Raul R. Labrador, Idaho Republican, called that option — apparently shopped to him by leadership — “a slap in the face,” though he said he would be “open-minded” about a separate vote on tax reform in general.

The next debt fight is looming later this year. If enough Republicans back the conservatives’ plan, it could reprise the 2011 showdown that ran to the brink and led to the downgrading of U.S. debt by one of the major credit rating agencies.

Rep. Steve Scalise, chairman of the House Republican Study Committee, said Mr. Boehner’s long-standing promise to match any debt increase with corresponding spending cuts should mean a balanced budget.

“The agreement was that any debt ceiling increase would correspond with the reforms that are necessary to meet the requirements in our budget — to get us to a balance in 10 years,” the Louisiana Republican said at a monthly forum of conservative members of Congress.

The fiscal 2014 spending proposal passed by the GOP-controlled House, which eschews tax increases in favor of cuts to entitlement programs and other spending, would balance the budget in 10 years.

But the budget Democrats powered through the Senate does not reach balance, nor does President Obama’s plan.

The House and Senate have made no progress in hammering out their differences. In fact, they can’t even agree to start the conference committee that would be tasked with negotiating.

Senate Democrats have tried repeatedly over the past few weeks to initiate the conference. They have been blocked by Republicans who say they first want assurances on taxes and debt.

Senate Majority Leader Harry Reid, Nevada Democrat, said conferences are how these issues are supposed to be worked out and that it made no sense to try to tie negotiators’ hands ahead of time. He also said Republicans will have an equal say in the conference because they control the House.

“Do Senate Republicans not trust their House Republican colleagues to hold the line on their priorities?” Mr. Reid said.

Sen. Ted Cruz, Texas Republican, said that is exactly the problem.

“Let me be clear: I don’t trust the Republicans,” Mr. Cruz said. “And I don’t trust the Democrats. And I think a whole lot of Americans, likewise, don’t trust the Republicans and the Democrats because it is leadership in both parties that has gotten us in this mess.”

The blockade is wearing down some Republicans, who said they want to see a conference started.

“We’re in a gridlock,” Sen. John McCain, Arizona Republican, said on the Senate floor Wednesday. “Four years without a budget, we finally get a budget, we stay up all night and because somebody doesn’t want to raise the debt limit, we are not going to go to conference. That’s not how this body should function. The American people deserve better. They deserve a budget.”

Meanwhile, the Treasury Department announced this week that the federal government’s new borrowing limit is $16.699 trillion — an increase of $305 million over the limit in February.

Under the terms of a February bill passed by Congress, the government is bumping up against a new limit. Treasury officials have said they are using special techniques to prevent breaching the limit, which could keep the government below the spending ceiling through the fall.

That gives all sides several months to fight it out.

A spokesman for Mr. Boehner, Ohio Republican, said talks are in the early stages.

“We have just begun the process of talking with members, and — more importantly — with the American people, about the best way to increase the debt limit consistent with the ’Boehner Rule,’ which requires cuts or reforms equal or greater than the increase,” spokesman Michael Steel said.