After intense discussion over the debt ceiling limit, the US House of Representatives voted overwhelmingly on the new debt ceiling bill. The debt ceiling has become a major concern for the United States economy and its people. Here are all the details.
What is the House vote on the debt ceiling bill?
The House of Representatives voted on the 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 314 votes in favor and 117 against. This bill and its approval will now go to the Senate for consideration.
Source: Office of the Clerk, US House of Representatives.
Joe Biden in his Twitter account mentioned “Tonight, the House took a critical step forward to avoid a first-time default and protect our country’s historic, hard-won economic recovery.”
The bill was passed just five days before the deadline set by the Treasury, who mentioned in his letter to House Speaker Kevin McCarthy that it will run out of funds on June 5, 2023, if the limit debt is not increased or suspended. The letter also said the Treasury would have to take extraordinary measures if funds ran out.
Subsequently, on May 31, 2023, the Treasury Department announced the list of extraordinary measures it will take to cover the debt of the United States government.
This is what was said, “The treasury secretaries of the Republican and Democratic administrations have exercised their authority to take certain extraordinary measures to prevent the United States from defaulting on its obligations while Congress deliberated on raising the debt limit.”
What is the debt ceiling agreement?
In May 2023, the United States government was reaching its debt ceiling. If the debt ceiling had not been raised, the government would have been forced to default on its debt. This would have had a devastating impact on the economy, leading to a loss of confidence in the US government and a rise in interest rates.
To avoid a default, President Biden and House Speaker Kevin McCarthy reached a compromise on May 27, 2023. The compromise reached a bipartisan budget agreement in which no one was completely satisfied with the terms.
The compromise led to a new bill that calls for suspending the US debt limit until January 1, 2025. This will allow the government to continue borrowing money and paying its bills.
READ| Explained: What is the new debt ceiling deal? Know the key announcements
What awaits us?
The US debt ceiling bill heads to the Senate, where it is expected to face more backlash. Republicans in the Senate have been more reluctant to raise the debt ceiling and it is unclear whether they will be willing to support the bill. The debt bill is a budget bill that requires the Senate to rely on reconciliation.
Mike Lee, a Republican senator, mentioned in his letter to Senate Majority Leader Chuck Schumer that he and 43 other senators will not consider any bill that would increase the amount of debt.
This is what the letter says “Therefore, we will not vote to kill any bill that raises the debt ceiling without substantial spending and budget reforms.”
Within the framework of reconciliation, the Senate approves a budget law by majority vote and requires 60 votes. Democrats do not have a 60-vote majority in the Senate, so they will need at least 10 Republicans to vote in favor of the bill in order to pass it.
However, some Republicans may be willing to vote for the bill to avoid a default on the national debt.
To conclude, if the Senate does not pass the debt ceiling bill, the government will be forced to default on its debt. This will create a devastating impact on the economy and is something that everyone wants to avoid. Therefore, it is possible that both Democrats and Republicans will reach an agreement and reach a decision on the debt ceiling in the Senate.