Last weekend, White House negotiators and House Speaker Kevin McCarthy reached a tentative agreement to suspend the debt limit and avoid default.
US lawmakers’ days are numbered to reach an agreement that would temporarily suspend the debt limit and avoid national default and possible disaster for the economy.
Last week, Secretary of the Treasury Department, Janet Yellen, warned lawmakers that the US must pay its debt before the 5th June, date on which the default would occur. The debt ceiling, which limits the amount of debt the country can hold, currently stands at $31.4 trillion. However, that limit was reached in January.
Last weekend, White House negotiators and House Speaker Kevin McCarthy reached a tentative agreement to suspend the debt limit and avoid default. From that moment, the countdown began for legislators, who had 72 hours to review the agreement and approve it by voting in plenary.
This Tuesday, the Rules Committee of the House of Representatives met to review the agreement, called Fiscal Responsibility Act of 2023. The agreement is expected to be put to a vote in the House this Wednesday.
If passed by a simple majority in the House, the bill would go to the Senate for another review, which could take several days. The vote would have to take place this weekend, days before the deadline. Once approved by both houses of Congress, the law goes to the president’s desk for his signature.
However, while lawmakers have expressed confidence that the bill will pass Congress, some Republicans have indicated that they will not sign the agreement. Rep. Chip Roy of Texas, a member of the standards committee, has urged his colleagues to vote against it.
Expansion of the problem
The deal would suspend the US borrowing limit. until January 1, 2025after the next presidential elections, which will take place in November 2024. The agreement would also keep non-defense spending practically the same for fiscal year 2024 and increase it by 1% in fiscal year 2025, according to the New York Times.
However, the suspension of the debt limit is a temporary measure, and the US would have to reduce the national debt or raise the ceiling before the new limit date.
For his part, the governor of the state of Florida and presidential candidate for 2024, Ron DeSantis, criticized the bipartisan agreement on Monday, alleging that USA “still heading towards bankruptcy”.
“Before this deal, our country was heading toward bankruptcy, and after this deal, our country will still be heading toward bankruptcy,” DeSantis said on Fox & Friends news.