Congressional Focus Shifts to the Debt Ceiling
Much of the debate in Congress in January will focus on the debt ceiling and sequestration. Although a few Members of Congress are talking about sustainable growth rate (SGR) issues now, most are not be eager to engage in these discussions until national debt issues and possible sequestration are resolved.
Congress will have to reach an agreement to raise the debt ceiling by mid February or the country will be faced with a potential credit downgrade. In addition, the March 1 date for sequestration to take effect looms above the Capitol like a dark storm cloud. Sequestration was temporarily delayed when the "American Taxpayer Relief Act" (HR 8) was signed into law by President Obama, January 2.
All government programs, including Medicare, face a two percent cut under sequestration. Last week, House Energy and Commerce Chairman Fred Upton (R-MI) stated he believed across the board budget cuts cannot be averted. There are some in Congress, on the other hand, who still believe a budget deal can be reached to avert sequestration. Regardless, there is increasing pressure on both sides of the aisle to cut spending.