The debt ceiling was suspended after the House of Representatives voted to enact a bill to do so. This will allow the United States to settle its debts while also reducing the amount of money spent by the federal government in the future.
According to NPR’s reporting, the Fiscal Responsibility Act of 2023 was approved by the House of Representatives with a vote of 314 to 117 on Wednesday night. This occurred with only a few days remaining and concessions made on both sides.
It establishes spending caps for the federal budget and implements policy changes, such as reclaiming approximately $27 billion in funding that had been allocated to federal agencies with the intention of combating the COVID-19 pandemic and phasing in higher age limits for work requirements on certain federal safety net programs like food stamps. In addition, it reclaims approximately $27 billion in funding that had been allocated to federal agencies with the intention of combating the COVID-19 pandemic.
The President referred to it as a “critical step forward to prevent a first-ever default,” and the Speaker of the House, Kevin McCarthy, stated that lawmakers “made history” with the amount of savings they achieved.
The Congressional Budget Office has projected that there will be a reduction in the overall deficit of $1.5 trillion over the course of the next decade; however, this does not take into consideration a number of “agreed-upon adjustments” that would raise federal spending in the coming months.
According to Bharat Ramamurti, the deputy director of the National Economic Council, which advises the president on economic policy, the viewpoint of the administration is that the bill removes the possibility of defaulting on financial obligations, safeguards entitlement programs such as social security and Medicare, and contributes to the preservation of economic progress made over the course of the past few years.
“We think we were able to secure some of our key priorities,” Ramamurti told Morning Edition’s Leila Fadel on Thursday. “If the speaker thinks that he got what he’s wanted to get out of this, that’s why you see bipartisan support for the deal both in the House and hopefully the Senate,” Ramamurti added.
The proposal will now be considered by the Senate, which is currently controlled by the Democrats. That chamber will have until Monday to provide its verdict on the bill in order to prevent the United States from defaulting on its debts. Senate leaders on both sides of the aisle have stated that they intend to vote on it as soon as they can, ideally by the end of the week.
That does not mean that all senators support the plan, which needs to receive sixty votes in order to be passed. The concessions made on issues like job requirements, student debt repayments, climate change, and taxes on the wealthy have been criticized by certain progressives, including Senators Bernie Sanders (I-Vt.) and Elizabeth Warren (D-Mass.).
While the administration values the viewpoints of all members of Congress, according to Ramamurti, “We think this is a good, fair deal.”
“As the president has said, this is a compromise, and a compromise means that nobody gets exactly what they want,” he continues. “A compromise means that nobody gets exactly what they want.” “There are certain aspects of this agreement where we share some of these concerns… but they were priorities for the Republican party, and in a world where we have a divided government, the deal’s going to have to reflect that reality,” the author of the document said.