The House approved a temporary increase in the nation’s debt limit. This will allow the federal government to continue paying its bills until December. It also temporarily prevents an unpredicted default that could have devastated the economy.
On a party-line vote, the Senate approved the $480 billion increase to the country’s borrowing limit. It was approved by the House Tuesday, so President Joe Biden will be able to sign it into law. Janet Yellen, Treasury Secretary, had warned that any steps taken to prevent default on the country’s debts would run out Monday and that the department would soon find it impossible to meet its financial obligations.
Global financial markets, which are based on the safety and security of U.S. debt, would be severely affected by a default. Routine payments by the government to Social Security beneficiaries, disabled veterans, and active-duty military personnel could also be questioned.
Although the legislation passed, the relief will be temporary. Congress will have to reconsider the issue in December. This is when lawmakers will be working to finish federal spending bills and avoid a government shutdown. Both parties face risks from the yearend backlog, which could lead to a turbulent close to Biden’s first year as president.
“I’m happy that this at most allows us to prevent an entirely self-made, utterly preventable economic disaster as we work towards a longer-term strategy,” stated Rep. Jim McGovern (D-Mass.
Republicans warned Democrats that Democrats shouldn’t expect their support and signaled they don’t believe the next debate on debt limit will be easy.
“Unless and until Democrats give-up on their dream for a big-government socialist America, Republicans can’t and won’t support raising the debt limit to help them pave a superhighway towards a great entitlement society,” stated Rep. Tom Cole (R-Okla.
The Senate bill was passed by the House on Tuesday. The measure was passed by a party line vote of 219 to206.
Senate Republican leader Mitch McConnell (R-Ky.), agreed to assist in passing the short-term debt ceiling increase. He insists that he will not do it again.
McConnell sent a Friday letter to Biden stating that Democrats would have to manage the next debt limit increase using the same process they used to pass Biden’s huge social spending plan and environment plan. Reconciliation allows legislation to be passed by the Senate with 51 votes instead of the usual 60. With her tiebreaking vote, Vice President Kamala Harris gives Democrats 50-50 split Senate.
Both parties’ lawmakers have used the debt limit votes to push for their other priorities. Nancy Pelosi, the House Speaker threatened to vote against raising debt ceiling while President Donald Trump was in office. She stated that she did not intend to support lifting debt ceiling to allow Republicans to give another tax cut to the wealthy. In 2011, Republicans coerced President Barack Obama to accept $2 trillion in deficit reductions as a condition of increasing the debt limit. However, some of those reductions were reversed by lawmakers.
Pelosi said Tuesday to reporters that Democrats and Republicans have both voted against raising the debt ceiling over the years, but not to the point of jeopardizing it.
Pelosi expressed hope that Congress would raise the debt limit in a bipartisan manner this December, given the stakes involved. She also proposed a bill that Rep. Brendan Boyle (D-Pa.) sponsored. It would transfer the obligation of raising the debt limit from Congress to the Treasury secretary.
McConnell has focused his attention on the debt limit and tried to connect Biden’s large federal spending boost with the nation’s rising debt load. However, they are not separate entities. The debt ceiling must be increased or suspended, regardless of whether Biden’s $3.5 trillion plan is passed into law.
McConnell wrote to the president, “Your Capitol Hill lieutenants now have the time and tools they claimed they needed to address the debt limit through standalone reconciliation.” “They can’t invent another crisis, and they cannot ask me for my assistance.”
McConnell was among 11 Republicans that voted with Democrats for the debt ceiling reprieve to be put to a final vote. McConnell and his GOP friends voted against final passage.
Sometimes, the debate about the debt ceiling has gotten personal. McConnell suggested last week that Democrats are playing “Russian Roulette” with the economy, claiming they have not addressed the debt ceiling through his process. Last week, he called out Pelosi for going to Europe.
McConnell stated that McConnell could only assume McConnell hopes that the United States will restore its faith and credit.
Pelosi refused to let the opportunity pass. “Russian Roulette from Moscow Mitch. She said that it was interesting.
Steny Hoyer (D-Md.), House Majority Leader, stated Tuesday’s vote was the 50th time since President Ronald Reagan that he had voted to extend the debt limit.
He stated, “Nobody is in control when it comes down to the debt limit.”
Hoyer called the Senate bill a “ludicrous deal” because it only allowed for a temporary extension.
Hoyer stated, “And then we’re gonna play this game another time. A despicable act for adults who should know better.”
Rep. Chip Roy (R-Texas) said he wanted “to thank” Hoyer for sharing the fact that he previously voted to raise the debt ceiling 49 more times.
Roy stated, “When he entered this body, there was about a trillion dollar in debt.” “I guess I’m expressing my gratitude on behalf of the Americans who have 28-and-a half trillion dollars in debt.”
Current debt ceiling: $28.4 trillion Both sides have contributed to this load by making decisions that have made it difficult for the government to operate in the black.
Because of the severe consequences of default, lawmakers have been able reach a compromise to lift/suspend the debt cap 18 times since 2002. This was often after many rounds of brinkmanship.