As President Joe Biden and Speaker Kevin McCarthy put together a bipartisan coalition of moderate Democrats and Republicans amid ferocious conservative backlash and progressive dissent, the House approved a debt ceiling and budget cutbacks plan late Wednesday.
This prevented a default crisis.
Few people were happy with the difficult agreement, but politicians judged it to be preferable to the alternative, which was a catastrophic economic downturn if Congress did nothing.
Hard-right Republicans rejected the accord, raising tensions throughout the day. Democrats countered that “extremist” GOP viewpoints were putting the country at risk of defaulting on its debt as early as next week.
The bill now moves to the Senate with passage anticipated by the end of the week after passing the House 314–117.
McCarthy declared in a late-night speech that his party was striving to “give America hope” and praised the bill’s budget cuts, which he claimed were necessary to rein in Washington’s “runaway spending.”
McCarthy, though, claimed it is merely a “first step” amid criticism from Republicans who claimed the spending curbs did not go far enough.
Biden earlier expressed confidence that the deal he and McCarthy reached to raise the country’s borrowing ceiling would be approved by the chamber and prevent an economically devastating default on America’s debts.
The president left for Colorado, where he will make the graduating speech at the American University on Thursday.
God willing, Congress and the House will have taken action by the time I arrive, bringing us that much closer.
The vote started about an hour and a half after Biden arrived in Colorado, so it wasn’t precisely the case.
To increase support, Biden dispatched senior White House officials to the Capitol.
In the haste to prevent a possibly cataclysmic U.S. default, McCarthy attempted to persuade wary Republican colleagues and even resisted challenges to his leadership.
Swift action by the Senate later this week would guarantee that Social Security retirees, veterans, and others will continue to receive government checks and would stop both domestic and international financial instability.
The Treasury has stated that the U.S. will run out of money on Monday.
Overall, the 99-page plan limits spending for the next two years, suspends the debt ceiling until January 2025, and makes certain policy adjustments, such as requiring elderly Americans getting food assistance to work more hours and approving a natural gas pipeline through the Appalachian region that many Democrats oppose.
Funds for the military and veterans are increased.
Raising the country’s $31 trillion debt ceiling assures the Treasury can borrow to pay off existing U.S. debts. Rep. Garret Graves of Louisiana, a top Republican dealmaker, argued that Republicans were pushing for budget cutbacks because Democrats had piled up deficits with additional spending, first during the COVID-19 crisis and then with Biden’s Inflation Reduction Act, with its unprecedented commitment to combat climate change.