House Republicans agreed Friday that they would demand conditions for raising the nation's debt ceiling, according to several sources who attended a closed-door discussion at the annual GOP strategy retreat in Cambridge, Maryland.
Extending U.S. borrowing in the early part of this year is the next potential confrontation on fiscal policy with Democrats and President Barack Obama, who has said he would not negotiate over the issue.
Members at the meeting asserted that a so-called "clean" debt bill could not get the support of the Republican conference and they want to press Senate Democrats and the White House to accept some sort of condition.
At the same time, there was a recognition that whatever they pushed had to be narrow and not provoke a major fight that might rattle financial markets, especially with congressional midterms on the horizon.
The debt ceiling represents a limit on how much the government can borrow to pay its bills.
The government effectively hits the debt ceiling on February 7, but the Treasury has some payment flexibility through accounting maneuvers for an additional month or so.
After that, it would rely solely on whatever cash on hand it has plus incoming tax revenue to meet obligations. But that would be insufficient to make all payments, raising the risk of default.
Republicans and Democrats have waged pitched political battles over spending and debt over the past two years. But with the last fight in October resulting in an unpopular government shutdown and Congress gearing up for midterms, lawmakers came together on a compromise budget.
That left the debt ceiling still to be resolved amid election-year partisanship.
Several ideas for conditions were put on the table at the Republican meeting, including one that would eliminate a provision in the Affordable Care act that would provide federal help to insurance companies.
Republicans have made the sweeping health care law championed by Obama a centerpiece campaign issue for November.
They expect to make a decision on GOP strategy on the debt-ceiling when members return to Washington next week.
A political dilemma for Republican leaders favoring a debt-celing increase is the possibility that even a bill with modest conditions might not clear the GOP-led House.
Why? Because those leaders believe there are many conservatives who would vote against it regardless. This means any additions to a debt measure would have to appeal to at least some Democrats.
House Speaker John Boehner told reporters on Thursday that a debt default would be unacceptable.
"We don't want to do that," he said.