Biden: Republican debt plan would harm 'millions of Americans'

Kevin McCarthy, the top Republican in the US House of Representatives, officially unveiled specifics of the plan earlier in the day, urging members of his party to act in concert as they go head to head with the president.

The United States hit its $31.4 trillion borrowing limit in January, prompting the Treasury to take "extraordinary measures" that allow it to continue financing the government's activities.

But if the debt ceiling is not raised or suspended by Congress before current measures are exhausted, the US government risks defaulting on payment obligations as early as July, with profound implications for the economy.

House Republicans are vowing to only raise the debt ceiling if federal spending caps are implemented, in an attempt to curb what they say is "reckless" spending by Democrats.

McCarthy is urging a floor vote before the end of the month, posting on Twitter Tuesday that it was "time to stop the madness."

"Democrats' reckless spending caused inflation, a banking crisis, and so many other problems," McCarthy wrote.

Biden, however, accused the Republican leader of proposing "huge cuts to important programs" that "millions of Americans count on," and says their plan would return the country to "the same old trickle-down economic theories of the past."

McCarthy's proposal would, among other things, return federal government spending to 2022 levels and limit its growth to one percent per year over the next 10 years.

Democrats are strongly opposed to the Republican proposal, arguing that linking a debt ceiling increase to budget cuts amounts to blackmail.

McCarthy "threatened to become the first speaker to default on our national debt," Biden said.

Senate Democratic leader Chuck Schumer said in a statement that no one "should confuse this wish-list as anything more than a recycling of the same bad ideas we've heard about for weeks."

The US president has said repeatedly that he is ready to discuss spending reductions but that Congress must first pass a "clean" -- no-strings-attached -- debt ceiling increase before time runs out.

McCarthy and Biden met in early February to discuss possible outcomes, but were unable to reach a compromise.

McCarthy must additionally overcome dissension in his own Republican ranks between his party's right wing and its more moderate lawmakers, to ensure the bill's passage in the House.