Biden says final US debt ceiling deal ready for Congress vote
US President and Speaker of the House of Representatives Kevin McCarthy is confident they will get enough support to avoid an unprecedented default.
US President Joe Biden has reached an agreement with House Speaker Kevin McCarthy to raise the debt ceiling for two years until January 1, 2025, saying the deal is ready to go to Congress for a vote.
The Democratic president and Republican speaker spoke on Sunday night as negotiators scrambled to draft and publish the bill so lawmakers could review compromises that are unlikely to be popular with progressive Democrats or far-right Republicans.
The two men hope they can secure enough votes before the June 5 deadline to avoid a first-ever default by the federal government. There will be a vote in the House of Representatives on Wednesday.
“Good news,” Biden declared at the White House on Sunday night.
“The agreement, for the first time in our country’s history, prevents the worst possible crisis – a payment default,” he said. “Takes the threat of catastrophic bankruptcy off the table.”
The deal follows weeks of heated negotiations between Biden and Republicans to avoid a default that could cause financial markets to freeze and lead to an international financial crisis.
Analysts say millions of jobs will disappear, loan and unemployment rates will rise, and a stock market fall could wipe out trillions of dollars in household wealth. A default would virtually destroy the $24 trillion government bond market.
Biden said he expected McCarthy to have the necessary votes to go through with the deal.
The compromise announced late Saturday includes cuts, but risks angering some lawmakers as they take a closer look at the concessions.
The 99-page bill will also reclaim unused COVID-19 funds, speed up the permitting process for some energy projects and include additional work requirements for food aid programs for poor Americans.
Senate Republican Leader Mitch McConnell applauded the agreement and called on the Senate to act quickly to pass it without undue delay once it passes through the House.
“Today’s agreement makes urgent progress toward preserving our nation’s full confidence and credit and is a much-needed step in getting its financial house in order,” McConnell said.
McCarthy rejected threats of opposition within his own party, saying that “more than 95 percent” of Republicans in the House were “overwhelmingly excited” about the deal.
“This is a good, strong law that a majority of Republicans will vote for,” the California Republican told reporters at the U.S. Capitol. “You will make sure that Republicans and Democrats can move this to the president.”
Republicans control the House by a 222-213 majority, while Democrats control the Senate by 51-49. These narrow margins mean that moderates on both sides will have to support the bill if it is opposed by hardliners in one or both parties.
“I’m not happy with some of the things I hear about,” Representative Pramila Jayapal, who chairs the Congressional Progressive Caucus, told CNN’s State of the Union.
She praised the deal that she said would save Medicaid from cuts while expanding the safety net to veterans and the homeless.
“We have retained the responsibility for the student debt that we have,” she said, referring to Biden’s policy of limited loan forgiveness.
Progressive Democrats in both chambers had said they would not support any deal that would require additional work for government food and health care programs.
The deal adds work requirements to food aid for some people ages 50 to 54, but White House officials said the carefully worded text would mean about the same number of people would have to meet the requirements as is the case under current law.