After a tense discussion on the debt ceiling limit, the US House of Representatives voted overwhelmingly for a new debt ceiling bill. The debt ceiling has become a major concern for the US economy and people. Here are all the details.
What is the House Vote on the Debt Ceiling Bill?
The House of Representatives voted on a debt ceiling bill to suspend the limit on Wednesday, May 31, 2023. According to the Clerk of the United States House of Representatives, the bill passed by a vote of 314 in favor to 117 votes anti. The bill and its approval will now go to the Senate for consideration.
Source: Office of the Secretary, United States House of Representatives
Joe Biden on his Twitter account mentioned “Tonight, the House of Representatives took a critical step to avert a first-ever default and protect our country’s historic and hard-won economic recovery.”
The bill passed just five days before the Treasury Department’s deadline in a letter to House Speaker Kevin McCarthy that said the bill would run out of money on June 5, 2023, if the debt limit is not increased or suspended. . The letter also stated that the Treasury would have to take extraordinary measures if it ran out of money.
Then on May 31, 2023, the Treasury Department announced a list of extraordinary measures it would take to settle the debt owed by the U.S. government.
Here is what was stated, “Treasury Secretaries in both Republican and Democratic administrations have exercised their authority to take a number of extraordinary measures to prevent the United States from defaulting as Congress considers raising the debt limit .”
What is the debt ceiling agreement?
In May 2023, the US government reached its debt ceiling. If the debt ceiling is not raised, the Government will be forced to default. This would have a devastating impact on the economy, as it could lead to loss of confidence in the US government and increased interest rates.
To prevent a default, President Biden and House Speaker Kevin McCarthy reached a compromise on May 27, 2023. This compromise resulted in a Bipartisan Budget Agreement in which no one was completely satisfied. satisfied with the terms.
The compromise resulted in a new bill that would suspend the US debt limit until January 1, 2025. This would allow the government to continue borrowing money and paying its bills.
READ| Explained: What is the new debt ceiling deal? Know about important announcements
What lies ahead?
US debt ceiling bill heads to the Senate, where it is expected to face more backlash. Senate Republicans appeared more opposed to raising the debt ceiling and it was unclear whether they would be willing to support the bill. The debt bill is a budget bill that requires the Senate to rely on reconciliation.
Republican Senator Mike Lee mentioned in a letter to Senate Majority Leader Chuck Schumer that he and 43 other senators would not consider any bill that would increase the debt.
This is what the letter said “Therefore, we will not vote in favor of any bill that would raise the debt ceiling without substantive budget and spending reform.”
Under reconciliation, the Senate passes budget legislation with a simple majority requiring 60 votes. Democrats do not have a 60-vote majority in the Senate, so they would need to get at least 10 Republicans to vote for the bill to pass.
However, it is possible that some Republicans are willing to vote for the bill to avoid defaulting on the national debt.
In short, if the Senate does not pass the debt ceiling bill, the government will be forced to default. This would have a devastating impact on the economy and is something everyone wants to avoid. Therefore, it is very likely that both Democrats and Republicans will compromise and reach a decision on the debt ceiling in the Senate.
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