President Biden signed legislation on Saturday to raise the debt ceiling by 2025 and avert a default. This marks a significant bipartisan victory amid the divided government in Washington, DC
The president signed the bill into law just days before Treasury Department officials warned that the department would run out of money to pay the country’s bills, potentially triggering a recession and hurting the economy.
In addition to raising the debt ceiling, the bill also includes agreements on spending caps, recovering unused COVID-19 aid funds, additional work requirements for certain people receiving government assistance, and removing some of the funding provided to the IRS in last year’s Inflation Reduction Act.
Otherwise, however, the bill leaves many of the Democrat priorities passed in the last Congress intact and does not include any new work requirements for Medicaid recipients.
The Senate passed the bill Thursday night by a bipartisan vote of 63 to 36. The House of Representatives passed the measure a day earlier in a similarly bipartisan fashion by a vote of 314 to 117.
Members of both parties found elements of the law objectionable. Many conservative Republicans felt the deal didn’t do enough to curb government spending, while progressive Democrats were particularly annoyed by the extra labor demands.
The legislation was the result of weeks of negotiations between Biden and Speaker Kevin McCarthy (Republican of California) and their respective teams.
Postponing the debt ceiling beyond the 2024 election gives Biden and other lawmakers running for re-election a reprieve by taking the possibility of a default off the table.
Biden and his team had insisted for months that there would be no debt ceiling negotiations. Eventually, the White House came to the negotiating table but insisted that budget negotiations, not the debt ceiling, were at stake.
White House allies hailed the deal as further evidence of Biden’s ability to operate across all parties and strike deals while ensuring his priorities are protected — a contrast they compare to leading Republican Party candidates who have often attack Democratic rivals in whom they show little interest, are keen to maintain bipartisanship.