WASHINGTON (Reuters) – U.S. lawmakers voted on Wednesday to raise the national borrowing limit as a crucial first step to averting a catastrophic default, giving the green light to a pact reached between warring parties in Washington after weeks of crisis and difficult behind-the-scenes negotiations.
Hammered between Democratic President Joe Biden and Republicans in the House of Representatives, the measure suspends the debt ceiling until 2024, slightly reducing public spending next year.
“Passing the Fiscal Responsibility Act is a critical first step in getting America back on track,” said Speaker Kevin McCarthy, the top Republican in Congress.
“He is doing what is responsible for our children, what is possible in a divided government and what is required by our principles and our promises.”
Biden hailed the 314-117 vote as a “critical step” to protect the country’s post-pandemic economic recovery that had been achieved through a “bipartisan compromise.”
The drama capped a tense few days on Capitol Hill, with the Treasury expecting to run out of cash as early as Monday.
The Republican majority in the House needed the help of dozens of Democrats to repel a right-wing rebellion – 71 conservatives voted no – and push the deal forward in the Senate, which is expected to follow suit by the end of the week.
McCarthy’s lieutenants had spent the last few hours frantically whipping votes, as senior Democrats vowed their members would put the nation’s finances above the temptation to give the opposition a nosebleed.
“The consequences of missing the deadline would reverberate around the world and take years to recover from,” Chuck Schumer, the leader of the Democratic-led Senate, warned ahead of the lower house vote.
“Remember, a default would almost certainly trigger another recession, skyrocket costs, kill millions of jobs – hard workers laid off through no fault of their own.”
The nonpartisan Congressional Budget Office estimates that proposed spending limits for 2024 and 2025 would reduce projected federal budget deficits by nearly $1.5 trillion over the next decade. The total debt amounts to more than 31 trillion dollars.
The vote was the result of weeks of on-and-off talks between the McCarthy and Biden teams, with Democrats accusing Republicans of holding the economy “hostage” by insisting on spending cuts to accompany the borrowing limit hike.
Tax hawks on the right in Congress have accused the White House of pushing unsustainable spending programs and say negotiating the future budget must be a condition for raising the limit, which covers debts already incurred.
The high drama seen in the recent debt ceiling and budget fights was absent, however, as House Minority Leader Hakeem Jeffries openly declared that its members would provide enough votes to ensure that the Bill would never be in danger.
But it was a high-tension act for McCarthy, whose job would have been on the line had the majority of its members rejected the pact, only to see it pass anyway.
Getting 149 Republican votes – about two-thirds of his caucus – allows McCarthy to project strength in his bid to deal with criticism from the Republican right, who have accused him of capitulating to the White House by not demanding more severe cuts.
Some hardliners have openly considered using a new power granted by McCarthy as part of his pitch for the presidency in January to call for a quick vote to oust him.
House Democratic Whip Katherine Clark described the vote as a “ransom” that Republicans had demanded by offering Americans “devastating cuts or we lose eight million jobs overnight.”
“It’s hard to take in because it’s so mean in cartoons. But unlike a cartoon, the American people won’t get back up when you drop this economic anvil on their head,” she said. declared.
The bill will require 60 votes in the 100-member Senate, and party leaders have urged their members to cooperate in a quick vote they hope to hold as early as Thursday evening.
Defense hawks have raised concerns about an $886 billion cap on defense spending, the amount Biden is asking for.
Meanwhile, Senators Jeff Merkley and Bernie Sanders – a Democrat and an independent who votes with the party – released separate statements saying they could not “in good conscience” support a bill cutting federal programs. keys while increasing military spending and requiring no additional taxes. billionaires.
Republican Senate Leader Mitch McConnell, who has largely relied on McCarthy in negotiations, is expected to provide at least a dozen votes, with most of the 51-member Democratic majority blocked.
Hammered between Democratic President Joe Biden and Republicans in the House of Representatives, the measure suspends the debt ceiling until 2024, slightly reducing public spending next year.
“Passing the Fiscal Responsibility Act is a critical first step in getting America back on track,” said Speaker Kevin McCarthy, the top Republican in Congress.
“He is doing what is responsible for our children, what is possible in a divided government and what is required by our principles and our promises.”
Biden hailed the 314-117 vote as a “critical step” to protect the country’s post-pandemic economic recovery that had been achieved through a “bipartisan compromise.”
The drama capped a tense few days on Capitol Hill, with the Treasury expecting to run out of cash as early as Monday.
The Republican majority in the House needed the help of dozens of Democrats to repel a right-wing rebellion – 71 conservatives voted no – and push the deal forward in the Senate, which is expected to follow suit by the end of the week.
McCarthy’s lieutenants had spent the last few hours frantically whipping votes, as senior Democrats vowed their members would put the nation’s finances above the temptation to give the opposition a nosebleed.
“The consequences of missing the deadline would reverberate around the world and take years to recover from,” Chuck Schumer, the leader of the Democratic-led Senate, warned ahead of the lower house vote.
“Remember, a default would almost certainly trigger another recession, skyrocket costs, kill millions of jobs – hard workers laid off through no fault of their own.”
The nonpartisan Congressional Budget Office estimates that proposed spending limits for 2024 and 2025 would reduce projected federal budget deficits by nearly $1.5 trillion over the next decade. The total debt amounts to more than 31 trillion dollars.
The vote was the result of weeks of on-and-off talks between the McCarthy and Biden teams, with Democrats accusing Republicans of holding the economy “hostage” by insisting on spending cuts to accompany the borrowing limit hike.
Tax hawks on the right in Congress have accused the White House of pushing unsustainable spending programs and say negotiating the future budget must be a condition for raising the limit, which covers debts already incurred.
The high drama seen in the recent debt ceiling and budget fights was absent, however, as House Minority Leader Hakeem Jeffries openly declared that its members would provide enough votes to ensure that the Bill would never be in danger.
But it was a high-tension act for McCarthy, whose job would have been on the line had the majority of its members rejected the pact, only to see it pass anyway.
Getting 149 Republican votes – about two-thirds of his caucus – allows McCarthy to project strength in his bid to deal with criticism from the Republican right, who have accused him of capitulating to the White House by not demanding more severe cuts.
Some hardliners have openly considered using a new power granted by McCarthy as part of his pitch for the presidency in January to call for a quick vote to oust him.
House Democratic Whip Katherine Clark described the vote as a “ransom” that Republicans had demanded by offering Americans “devastating cuts or we lose eight million jobs overnight.”
“It’s hard to take in because it’s so mean in cartoons. But unlike a cartoon, the American people won’t get back up when you drop this economic anvil on their head,” she said. declared.
The bill will require 60 votes in the 100-member Senate, and party leaders have urged their members to cooperate in a quick vote they hope to hold as early as Thursday evening.
Defense hawks have raised concerns about an $886 billion cap on defense spending, the amount Biden is asking for.
Meanwhile, Senators Jeff Merkley and Bernie Sanders – a Democrat and an independent who votes with the party – released separate statements saying they could not “in good conscience” support a bill cutting federal programs. keys while increasing military spending and requiring no additional taxes. billionaires.
Republican Senate Leader Mitch McConnell, who has largely relied on McCarthy in negotiations, is expected to provide at least a dozen votes, with most of the 51-member Democratic majority blocked.
