H.R. 4634: Debt Ceiling Reform Act

This bill, known as the Debt Ceiling Reform Act, aims to establish a process that ensures the United States does not default on its financial obligations by managing the country's debt ceiling more effectively. Here are the key components of what the bill proposes:

Suspension of the Debt Ceiling

The bill introduces a new section in the U.S. Code that provides a method for temporarily suspending the debt ceiling. It outlines the following important aspects:

• The Secretary of the Treasury can certify that the debt ceiling should be suspended, which must be done in writing to Congress.
• This certification must specify a time period during which the debt limit is suspended, which cannot exceed two years.

If Congress does not enact a joint resolution disapproving this certification within 45 days, then the suspension will automatically take effect.

Joint Resolution Process

The bill details the formal procedure Congress must follow if it wishes to disapprove of the Secretary of the Treasury's actions regarding the debt ceiling:

• Any joint resolution disapproving the suspension of the debt ceiling must be introduced within a specific 45-day timeframe.
• The resolution must not include a preamble and must clearly state that Congress disapproves of the Secretary’s certification.

Committees in the House of Representatives are required to report on such resolutions within 5 days. If they fail to do so, the resolution can proceed without further committee action.

Expedited Consideration

The bill ensures accelerated handling of any joint resolutions by both the House and the Senate:

• In the House, there are specific timelines for reporting and considering the resolutions created by the Secretary of the Treasury’s certifications.
• In the Senate, joint resolutions are automatically placed on the calendar and considered without the usual procedural delays, ensuring timely debate and voting.

Changes in Debt Issuance

The bill restricts the Secretary of the Treasury from issuing new debt solely to increase cash reserves during any suspension period, allowing debt issuance only to meet the government's obligations. This approach aims to restore more oversight on the national debt and ensure that any incurred debts are necessary for budgetary commitments.

Reporting on National Debt

The bill also requires that estimates of national debt, particularly with respect to the gross domestic product (GDP) of the United States, be provided. This means that future reports about national debt must include statistics about the debt held by the public as a percentage of the GDP.

Transitional Rules

For situations where the debt ceiling is currently in effect at the time this bill is enacted, transitional rules are provided to ensure that the suspension process can be applied effectively, paving the way for future suspensions as needed.

Rules of Congressional Procedure

The bill includes provisions that allow certain procedural rules to be altered specifically for handling these joint resolutions. This ensures that the measures enacted by this bill take precedence over existing rules that may hinder quick resolution.

Relevant Companies

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