Hours of negotiations behind those involved: in the United States there was an agreement on a debt dispute. Democrats agreed to a temporary solution. However, this does not prevent the problem.
After days of struggle, he has United States Congress Avoid bankruptcy of the largest economy in the world right now. The US Senate approved Thursday night (local time) to raise the debt ceiling by 480 billion US dollars by December. The vote on the convention was a narrow 50 to 48 vote along partisan lines—no Republicans joined the Democrats. However, the increase can only be put to a vote in advance with the help of Republicans. Parliament must also approve.
The proposal was introduced by the conservative Senate Minority Leader, Mitch McConnell. “I have good news: We have reached agreement on extending the debt ceiling through December,” Schumer said before the Senate vote.
This was preceded by violent arguments between Democrats and Republicans – they blame each other for the very serious conflict. Minister of Finance Janet Yellen He warned of a possible financial crisis and a possible recession if the US government fails to service its debt for the first time.
According to your department, the US could have run out of money on October 18, in less than two weeks. Yellen said that if the US defaults, a recession is likely. Because of the leading role of the United States, there was also a threat of global economic turmoil.
In fact, the agreement reached on Thursday now postpones the parliamentary debate to the end of November. In addition to the debt ceiling, Congress must also approve a new budget by the beginning of December if it wants to avoid the paralysis of federal institutions, the so-called “shutdown.”
Republicans are pushing a separate path
While the debt ceiling has been suspended or raised dozens of times under a bipartisan presidency over the past few decades, Republicans are now standing in the opposite direction. With a disabled minority in the Senate, the party prevents the debt ceiling from being suspended through normal legal channels.
With the interim settlement, McConnell is pushing Democrats to adopt a special path known as “reconciliation” toward a permanent solution. The Democrats wanted to avoid that. They find this procedure is time consuming and risky. Plus, they don’t want to absolve Republicans of responsibility for jointly handling the country’s debt burden, especially since debt also dates back to the Trump era.
The Democrats He accuses Republicans of obstructing Biden’s political agenda and of wanting to create chaos before next year’s congressional elections. Biden accused Republicans of “playing Russian roulette with the American economy.” Since Barack Obama’s Democratic presidency, Republicans have used the debt ceiling as a means of political pressure.