WASHINGTON (Reuters) -The U.S. Senate on Tuesday approved raising the federal government’s debt limit by $2.5 trillion, to about $31.4 trillion, and forwarded the measure to the House of Representatives to avoid an unprecedented default.
The 50-49 party-line vote follows a months-long standoff between Democrats and Republicans, with the latter seeking to force President Joe Biden’s party to raise the debt limit from the current $28.9 trillion level on its own, generating fodder for attack ads during the 2022 congressional elections.
A deal last week between Democratic Senate Majority Leader Chuck Schumer and his Republican counterpart, Mitch McConnell, set the stage for Tuesday’s vote, bypassing normal Senate rules requiring at least 60 of the chamber’s 100 members to agree on most legislation.
The Democratic-led House will also need to approve the bill before sending it to Biden for his signature. The chamber was expected to take the matter up later on Tuesday.
Schumer said the increase would take borrowing into 2023, through the Nov. 8 midterm elections that will determine control of Congress.
U.S. Treasury Secretary Janet Yellen had urged Congress to hike the debt limit before Wednesday.
The increase is needed in part to cover debt incurred during Republican Donald Trump’s presidency, when the debt rose by about $7.85 trillion, partly through sweeping tax cuts and spending to fight the COVID-19 pandemic.
Republicans, who oppose the debt ceiling increase and control half of the Senate’s 100 seats, have tried to link the vote to Biden’s $1.75 trillion “Build Back Better” bill to bolster the social safety net and fight climate change.
“Later today, every Senate Democrat is going to vote along party lines to raise our nation’s debt limit by trillions of dollars. If they jam through another reckless taxing and spending spree, this massive debt increase will just be the beginning,” McConnell said in a speech in the chamber.
Under the unusual deal https://www.reuters.com/markets/rates-bonds/deal-avert-us-default-raise-debt-limit-faces-test-senate-2021-12-09 worked out by Schumer and McConnell, and approved by both chambers last week, legislation raising the debt ceiling could be passed this one time in the Senate by a simple majority, which meant Democrats could get it through on their own.
“This is about paying debt accumulated by both parties, so I’m pleased Republicans and Democrats came together to facilitate a process that has made addressing the debt ceiling possible,” Schumer said on the Senate floor.
The debt ceiling fight and another self-created crisis, passing a bill to continue funding the government through February, occupied much of Congress’ time this month, and members in both chambers are now eager to begin long holiday breaks.
Votes to lift the country’s debt ceiling have taken place on a regular basis since World War One. But some lawmakers in recent years have grown squeamish at such legislation, fearing voter backlash.
Senate Finance Committee Chairman Ron Wyden told reporters on Tuesday that he would push to eliminate the borrowing limit to avoid future political standoffs over the recurring need to increase it.
Source: Economy - investing.com
