House Speaker John Boehner has reportedly offered to delay for a year any fight over raising the federal debt limit, a move that may give up some leverage for Republicans but jump start the fiscal cliff negotiations again.
Boehner, R-Ohio, made the proposal to President Obama on Friday, in the latest round of negotiatons to avoid the "fiscal cliff" -- a term that refers to the $500 billion in automatic tax hikes and spending cuts that will kick in if a debt-reduction deal is not reached by the end of the year, the Washington Post reports.
A spokesman for Boehner told the Post that any debt limit increase would have to be matched with spending cuts.
By March, the national debt is expected to hit the $16.4 trillion limit set last year. Unless Congress raises the debt ceiling in time the country is at risk for a government default. Some Republicans view this threat as a good opportunity for leverage to demand additional spending cuts from Obama, the Post said.
The debt ceiling issue is key because Obama and Boehner would probably rather avoid a repeat of what happened in 2011, when a drawn out battle over the debt limit ended with only hours to spare or the government would have run out of money. The contentious episode led to the first ever downgrade of the nation's credit rating and will cost taxpayers 18.9 billion in additional interest costs over the next decade, Politico reported