The US Congress has approved a financial deal between the White House and congressional Republicans, ending a weeks-long political standoff and successfully preventing the risk of an unprecedented debt default in the world's largest economy.
On June 1, the US Senate voted 63-36 to approve the bill that was passed by the House of Representatives on May 31 as lawmakers raced against time to avoid a June 5 debt default.
While many members of Congress remain skeptical of the terms of the deal, they are confident that their concerns are not worth the risk of default. The bill now goes to President Joe Biden for his signature.
Mr Biden praised the timely action of the US Congress. “This bipartisan agreement is a major victory for our economy and the American people,” the Democratic president said in a statement, adding that he would sign it into law as soon as possible.
Senate Majority Leader Chuck Schumer expressed satisfaction with the debt ceiling deal recently passed by the US Senate. Photo: Al Jazeera
The bill would suspend the statutory limit on federal borrowing until January 1, 2025, and set a spending cap on the government for the next two years. The nonpartisan Congressional Budget Office estimates the bill would save $1.5 trillion over 10 years.
“This debt ceiling agreement will not limit the Senate’s ability to appropriate emergency supplemental funding to ensure our military capabilities are sufficient to deter China, Russia, and other adversaries and address ongoing and evolving national security threats, including the Russia-Ukraine conflict,” said Senate Majority Leader Chuck Schumer.
The Senate's passage of the debt ceiling bill ended the biggest stalemate over the US public debt since 2011, when the country was on the brink of default.
However, it comes with some “political costs” for both President Biden and House Speaker McCarthy, who are seen as having conceded too much in the negotiations.
The ultra-conservative group has repeatedly criticized Mr McCarthy after more Democrats voted for the bill in the House than Republicans. Members of the Freedom Caucus will meet next week to discuss further actions, including an effort to oust Mr McCarthy.
For Mr Biden, the vote risks alienating progressives, making it difficult for him in some key constituencies.
But he faces no serious primary challenge from the left, and the deal helps him stave off an economic upheaval that could derail his re-election bid .
Nguyen Tuyet (According to Bloomberg, Financial Times, Reuters)
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