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The U.S. Senate voted Tuesday evening for the government to raise the loan limit by $ 2.5tn, in an 11-hour effort to avoid default within a year.
The Senate vote, which is expected to be closely followed by a second vote in the House of Representatives, comes a day before the deadline of December 15 set by Janet Yellen, US Treasury Secretary, who for several weeks warned of government threats. infidelity.
Democrats and Republicans have been at loggerheads for months over debt growth, with the GOP insisting that President Joe Biden’s party “go it alone” by removing lending limits, while blaming Democrats for misuse.
But leaders of the two parties reached a climax last week when a majority of Republicans agreed to change a single law allowing Democrats to take action. raise the debt sky using a simple majority, rather than being required to remove 60 filibuster votes in the Senate. The coalition severely divided Republicans, with 14 GOP lawmakers signing the amendment.
None of the Republicans voted to raise the debt when the issue came up in the Senate on Tuesday, and the opposition party is not expected to return the vote in the next Democrat vote. Biden must be signed into law by Biden for it to take effect.
Democratic Senate chief executive Chuck Schumer said on Tuesday that the $ 2.5tn loan plan would give the government another year – delaying repayment until next year’s general election.
“The idea that we will vote for will give the debt a boost to the level of money needed to enter 2023,” Schumer said.
“These are debt repayments that both parties have secured, which is why I am so glad the Republicans and Democrats came together to support the process that has made the debt possible,” he added.
In recent weeks, some of the participants in the market have tried to reduce their exposure to US government debt by the time it arrives. But two strong stocks last week of Treasury bills expected to mature in four to eight weeks show that any frustration that comes with debt volatility has diminished.
Tuesday’s vote is the latest in a long list of concerns that Congress should lift before the Christmas holidays. Earlier that month, lawmakers took action to ban a state closure, voting for the government to provide state funding early next year and to delay further controversy over the federal budget. Congress members are also expected to vote this week on another option to continue funding US troops.
It is unknown at this time what he will do after leaving the post Build Back Better Social spending bill. Democrats have insisted they will be able to do so within a year, but their hopes have been dashed by a handful of dissidents in the party, most notably Joe Manchin, a West Virginia senator.
Manchin and Biden spoke privately Monday and Tuesday as the White House debated an agreement to meet with a West Virginia senator, who argued over size and spending in terms of consumer spending. prices.
Additional reports by Colby Smith in Washington
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