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4w ago

Senate Republicans Edge Closer to Debt Ceiling Increase in Reconciliation Bill

GOP negotiates internal divisions over Medicaid cuts, tax policy, and spending reductions as default deadline looms.

Senate Majority Leader John Thune (R-SD) speaks with reporters following the Senate Republicans' weekly policy lunch on Capitol Hill in Washington, D.C., U.S., March 11, 2025.
Senate Majority Leader John Thune takes a question from a reporter as he walks off the Senate floor at the Capitol on March 24, 2025 in Washington, DC.
Trump delivers address to Congress
Speaker of the House Mike Johnson departs following a news conference following a meeting of the House Republican Conference on Capitol Hill on Tuesday, in Washington, DC.

Overview

  • Senate Republicans are increasingly open to including a $4 trillion debt ceiling hike in their reconciliation bill, aligning with the House's approach.
  • Internal GOP divisions persist over Medicaid cuts, with moderates pushing to limit reductions to $250 billion while conservatives demand deeper cuts.
  • The proposed use of a 'current policy baseline' to reduce the apparent cost of extending the 2017 tax cuts faces procedural uncertainty and criticism for its fiscal implications.
  • The Congressional Budget Office warns the U.S. could default on its debt by August or September 2025 without action, adding urgency to negotiations.
  • A Senate vote on the budget resolution is expected as early as next week, though disagreements over spending cuts and procedural hurdles remain unresolved.