Senator Cory Gardner (R-CO) and Senator Mike Lee (R-UT) introduced the Reducing Excessive Government (REG) Act, legislation that would require any increase in the debt limit approved by Congress and the President be accompanied by a proportional reduction in regulatory burden for every new dollar of debt.
Last week, Treasury Secretary Mnuchin asked Congress to raise the federal debt ceiling so the United States would not default on its obligations. Mnuchin also notified Congress that the Treasury Department will be taking “extraordinary measures” starting today, March 16, to avoid default.
“After eight years of unchecked spending, it’s time to institute real reforms that will help get our fiscal house in order,” said Gardner. “As we once again consider raising the federal debt ceiling, we must find ways to eliminate burdensome regulations that hinder economic growth and further impair our nation’s solvency. American small businesses and entrepreneurs know what it takes to create jobs and grow the economy, and it is up to Congress to get Washington out of the way and allow them to succeed. The REG Act is an innovative approach that will allow for commonsense regulatory reform and I’m proud to work with Senator Lee on this important effort.”
“Any time Congress decides to raise the debt ceiling, substantive policy changes need to be made that would affect the long-term trajectory of the country,” said Lee. “This bill would require a serious evaluation of our regulatory policy any time the debt ceiling is raised. It would give Congress the power and regular opportunity to lift regulatory burdens on the public that hurt innovation and growth.”
In the event of a temporary suspension of the debt limit, the REG Act would require the Secretary of the Treasury to submit an estimate to Congress for the amount of new debt which would be incurred during that suspension. If the debt limit were to be raised by a set amount rather than suspended, a proportional reduction of at least 15 percent would apply to that set amount.
Additionally, the REG Act requires federal agencies to provide Congress with a report, certified by the Government Accountability Office, of regulations with a cost to the United States’ economy of over $100 million. Congress would be required to vote on the removal of an amount of regulatory burden equal to at least 15 percent of the amount of new debt. The President would then sign that removal legislation into law. If Congress fails to pass the removal of regulatory burden or the President fails to sign it, the debt limit would snap back to current levels plus any debt acquired since passage of legislation to increase or suspend the debt limit.