House Debates Debt Ceiling Raise, Spending Cuts as Final Vote Approaches
The National Desk - May 31, 2023 5:27 pm
FILE - House Speaker Kevin McCarthy of Calif., speaks to reporters about debt limit negotiations, Wednesday, May 24, 2023, on Capitol Hill in Washington. (AP Photo/Jacquelyn Martin, File)
WASHINGTON (TND) — Members of both parties debated the merits and drawbacks of a new debt and budget bill Wednesday afternoon before a final vote to raise the nation’s borrowing limit.
The “Fiscal Responsibility Act of 2023” contains the agreement reached by Speaker of the House Kevin McCarthy, R-Calif, and President Joe Biden over raising the debt ceiling ahead of a government default around June 5 while also putting a limit on government spending. Both major branches of the deal would last into 2025.
While the Treasury Department initially forecast the government would reach its borrowing limit on Thursday, earlier this month Secretary Janet Yellen moved that date to June 5. If Congress is unable to pass an agreement to raise the debt ceiling – the amount of money the U.S. government can borrow to pay off its existing debts – by that date, the U.S. would be forced to default, which would not only almost certainly lead to a recession but also a global economic upheaval. However, since the U.S. has never defaulted before, economists do not know what the extent of such economic consequences would be.