The US Senate passed a bill suspending the debt limit until 2025, thanks to which the US will avoid bankruptcy. Both parties have agreed that the spending cuts will not affect the adoption of additional funds to help Ukraine and other defense spending.
“America can breathe a sigh of relief because thanks to this process we avoided bankruptcy,” said the leader of the Democratic majority in the Senate on Friday Chuck Schumer.
The Senate voted to suspend the debt limit
The Senate passed the bill by a vote of 63-36 a day after the House of Representatives did the same with the support of about two-thirds of congressmen from both parties. The bill still needs to be signed by the president Joe Bidenwho promised to do so as soon as possible.
“Tonight, senators from both parties voted to protect economic recovery and avoid the first-ever US bankruptcy. Together, they showed once again that America is a country that pays its bills and honors its obligations – and always will,” he wrote. president in a statement.
Republican Senator Lindsey Graham and several other party colleagues forced Schumer to pledge that the spending cap agreement would not limit the Senate’s ability to allocate additional money to, among other things, for help Ukraine and the military in the face of threats from Russia and China.
The bill was adopted after sometimes dramatic negotiations in the face of the possible bankruptcy of the US and despite strong opposition from some members of the House of Representatives and senators of both parties. Some of the most radical austerity supporters among Republicans even threatened to remove Kevin McCarthy from office, but in the end the Republican Speaker of the House of Representatives managed to limit the rebellion in the party. Left-wing Democrats, in turn, opposed social cuts and tightening of criteria for access to programs for the poorest families.
The act suspends the debt limit until January 2025 and freezes budget spending in the fiscal year 2024 – apart from defense spending – at the current year’s level. The agreement provides for an increase in these expenses by 1%. next year. According to the analysis, this will reduce it budget deficit by $1.5 trillion over 10 years.
Suspension of the debt ceiling last set by Congress at $31.4 trillion is necessary to United States avoided bankruptcy. According to the Treasury Department, without such a decision, the government would run out of funds to cover all its liabilities next week.
Main photo source: PAP/EPA/MICHAEL REYNOLDS