An agreement struck on Thursday allows the government to cover its expenses through early December, but does little to address the crux of the partisan stalemate.
By Emily Cochrane for The New York Times |
Islam News – The U.S. Senate passed legislation on Thursday to raise the debt ceiling through early December, after a small cluster of Republicans temporarily put aside their objections and allowed action to stave off the threat of a first-ever federal default.
According to The New York Times, The action came the day after Senator Mitch McConnell of Kentucky, the Republican leader, partly backed down from his blockade on raising the debt limit, offering a temporary reprieve as political pressure mounted to avoid being blamed for a fiscal calamity.
But the fragile deal to move ahead was in doubt until the very end, with some Republicans reluctant to drop their objections. Mr. McConnell and his top deputies labored into the evening on Thursday to persuade enough members to clear the way for a vote. Ultimately, 11 Republicans joined every Democrat in voting to take up the bill, clearing the 60-vote threshold needed to break the G.O.P. filibuster.
The final vote was 50 to 48, with Democrats unanimously in support and Republicans united in opposition. Representative Steny H. Hoyer of Maryland, the majority leader, said the House would return on Tuesday to take up the bill.
“Republicans played a dangerous and risky partisan game, and I am glad that their brinkmanship did not work,” said Senator Chuck Schumer of New York, the majority leader. “What is needed now is a long-term solution so we don’t go through this risky drama every few months.”
The bill would raise the statutory debt limit by $480 billion, an amount the Treasury Department estimates would be enough to allow the government to continue borrowing through at least Dec. 3. The current debt limit was set at $28.4 trillion on Aug. 1, and the Treasury Department has been using so-called extraordinary measures to delay a breach of the borrowing cap since then.
The agency estimated that the government would no longer be able to pay all of its bills by Oct. 18, once those fiscal accounting maneuvers were exhausted. Without congressional action before then, economists and lawmakers have warned of catastrophic economic consequences, including the U.S. government having to choose between making interest payments on its debt and sending out Social Security checks and other crucial assistance.
The legislation under consideration on Thursday did not offer a hard deadline for when cash would run out, and it would not restart the Treasury Department’s ability to employ extraordinary measures, such as curbing certain government investments, a Treasury official said. Some Republicans said they thought the set dollar figure would ensure the limit would not be reached again until at least January.
The actual “X-date” will be determined by calculating tax revenues and expenditures. Making such projections has been especially difficult this year because pandemic relief programs have made it hard to predict when money is coming and going.
Source: The New York Times