The GOP’s Debt Ceiling Bill Could Be A Ticking Time Bomb For Black Households

It’s a ‘reckless attempt to extract extreme concessions,’ the White House says.

Racial disparities in health care, education, wealth and other areas make the Black community vulnerable to the GOP’s proposed federal spending cuts in their debt ceiling bill.

The Biden administration says the Republicans are holding the nation hostage by demanding “extreme concession” to raise the debt ceiling, which would avoid a government default.

House Speaker Kevin McCarthy cobbled together enough support among divided Republicans to approve the so-called Limit, Save, Grow Act of 2023 in a party line vote of 217- 215 on April 26.

3 Ways The Debt Ceiling Crisis Impacts Black Households As Lawmakers Negotiate Resolution

No Democrats supported the GOP debt ceiling bill and the White House had harsh words for it.

“The Administration strongly opposes the Limit, Save, Grow Act of 2023, which is a reckless attempt to extract extreme concessions as a condition for the United States simply paying the bills it has already incurred,” a White House statement said.

“The President has been clear that he will not accept such attempts at hostage-taking. House Republicans must take default off the table and address the debt limit without demands and conditions, just as the Congress did three times during the prior Administration,” the statement continued.

Senate Majority Leader Chuck Schumer, a New York Democrat, announced Monday (May 1) that the Democrat-controlled Senate plans to hold hearings to “expose the true impact” of House Republicans’ proposal to lift the debt ceiling, The Hill reported.

Meanwhile, Treasury Secretary Janet Yellen alerted lawmakers that the nation could default on its debt as early as June 1 if they do not raise or suspend the federal government’s ability to borrow money to pay its bills, potentially setting off a global financial crisis.

Among the proposals, the bill seeks to freeze spending for a decade, roll back parts of President Joe Biden’s health and climate initiatives, as well as cancel his college student debt forgiveness program. If allowed, the GOP debt ceiling bill could have a damaging impact on the Black community.

Student debt

The Republican bill would cancel Biden’s student loan debt relief plan that the administration launched in August. His plan would eliminate $10,000 in debt for Americans who earn less than $125,000 annually, and $20,000 for lower-income borrowers. The U.S. Supreme Court is currently examining Biden’s initiative, which Republicans argue is a misuse of taxpayer dollars to pardon the debts of some Americans.

Black college graduates borrow at a higher rate than other racial and ethnic groups, with more than 80 percent of Black bachelor’s degree recipients owing an average of $34,000, according to The Institute for College Access and Success. Unsurprisingly, Blacks also default at a higher rate.

Black women are particularly impacted, according to the nonprofit group Education Trust. In addition to system racism, the gender pay gap makes women more at risk of default than men.

President Biden’s Federal Student Loan Debt Relief Program Faces Crucial Hurdle At Supreme Court


The Republicans propose repealing tax breaks and other clean-energy initiatives, which Democrats use incentives to cut greenhouse gas emissions and to promote green energy, according to Reuters. It attacks a section of the Biden Inflation Reduction Act of 2022 that the administration said would increase investment in battery plants, electric vehicles and create green jobs while helping to improve the environment.

Reversing that clean air initiative makes many Black communities across the nation vulnerable. Polluted air is especially harmful to Black Americans who are 30 percent more likely to have asthma than White Americans, according to the Department of Health and Human Services. Blacks are also nearly three times more likely to die from asthma related causes.

At the same time, Black communities face increasing risk of flood damage if climate change continues unabated. Predominantly Black neighborhoods will be hit the worst by rising water levels and damage from hurricanes by the mid century, NBC News reported last year, citing a study in the journal Nature Climate Change.

Food stamps and health care

The Republicans want tighter work requirements for millions of low-income Americans who receive government help purchasing food through the Supplemental Nutrition Assistance Program (SNAP) and health care through Medicaid.

Under the plan, Medicaid recipients must satisfy certain income or work thresholds that include participating in 80 hours per month in employment or community service, according to The Washington Post. States could remove Medicaid recipients from the rolls if they fail to comply. The rules would apply to those aged 19 to 56, making some exceptions for pregnant women or those caring for young children.

As for SNAP, the bill would require adults without children to meet new work requirements until they reach age 56, raising the current age limit of 49. It would also eliminate the work requirement flexibility that some states use when the unemployment rate is high.

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