Agreement to avoid US default and raise debt limits faces Senate trial – 12/09/2021

Agreement to avoid US default and raise debt limits faces Senate trial – 12/09/2021

by Richard Cowan

WASHINGTON (Reuters) – A deal between Democratic and Republican leaders in the US Senate to raise the federal government’s debt limit – currently $28.9 trillion – will pass a test on Thursday when the Senate floor voted on the measure.

The House of Representatives on Tuesday passed an unusual bill — adopted by Senate Majority Leader Chuck Schumer and Minority Leader Mitch McConnell — to circumvent the Senate “barrier” rule and, ultimately, increase the federal debt allowance by a simple majority vote. for.

The deal comes just two months after Congress agreed a short-term increase in the debt limit to avoid an unprecedented default by the federal government on its obligations that would have devastating effects for the world economy.

Republicans have tried to back their votes in favor of greater lending authority, arguing that the increase would pave the way for the passage of President Joe Biden’s $1.75 trillion domestic investment bill, which they oppose. .

Democrats note that the bill is needed to finance the debt, largely during Donald Trump’s administration, when Republicans voluntarily increased Washington’s credit card bill by nearly $7.85 trillion, in part by half. Expenditure cuts to fight the Covid-19 pandemic.

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