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House passes bill to suspend debt ceiling

By AI HEPING in New York | China Daily Global | Updated: 2023-06-01 09:29

US House Speaker Kevin McCarthy talks to reporters after voting on the House floor in the midst of ongoing legislative wrangling over whether to raise the United States' debt ceiling and avoid a catastrophic default, at the US Capitol in Washington, US May 31, 2023. [Photo/Agencies]

The Republican-controlled House of Representatives with help from Democrats approved a bipartisan bill Wednesday to suspend the US debt ceiling for two years and limit federal spending to avoid a disastrous and unprecedented default.

The final vote was 314-117, with 165 Democrats and 149 Republicans voting for it. Opposing the bill were 71 Republicans and 46 Democrats.

Republicans control the House 222-213, and House Speaker Kevin McCarthy needed 218 votes to push the deal through.

The deal agreed to by President Joe Biden and McCarthy now goes to the Democrat-led Senate for its expected approval and then to Biden for his signature. It faces a Monday deadline to become law to avert default.

In a statement, Biden thanked "Speaker McCarthy and his team for negotiating in good faith".

In a tweet, McCarthy said: "The House just passed the biggest spending cut in American history."

The deal suspends the nation's $31.4 trillion borrowing limit until January 2025. It essentially gives the Treasury Department the latitude to borrow as much money as it needs to pay the nation's bills during that time.

The centerpiece of the agreement remains a two-year suspension of the debt ceiling, which caps the total amount of money the government is allowed to borrow. Suspending that cap would allow the government to keep borrowing money and pay its bills on time.

Before the House voted on the bill, Democrats helped push through a procedural rule Wednesday afternoon to allow the bill to be debated. The rule was approved 241-187, with 52 Democrats in support and 29 Republicans opposed.

"House Democrats are going to make sure the country doesn't default. Period. Full stop," House Democratic Leader Hakeem Jeffries told reporters earlier Wednesday.

On Tuesday, the House Rules Committee narrowly advanced the 99-page legislation for a vote by the House. The GOP-controlled committee voted 7-6 to move the legislation to the House floor, with no Democrats joining Republicans in support.

The bipartisan deal would suspend the $31.4 trillion borrowing limit until January 2025. It would lift the debt ceiling by $1.5 trillion in exchange for saving $4.3 trillion by capping spending for two years.

According to the Congressional Budget Office (CBO), it would cut federal spending by $1.5 trillion over a decade by effectively freezing some funding that had been projected to increase next year and then limiting spending to 1 percent growth in 2025, which is considered a spending cut because the increase won't keep pace with inflation.

The legislation would also impose stricter work requirements for food stamps, take back some funding for the Internal Revenue Service enforcement and unspent coronavirus relief money, accelerate the permitting of new energy projects and officially end Biden's student loan-repayment freeze. The deal pushes through an Appalachian natural gas line that many Democrats oppose.

Staunch conservative Republicans and progressive and liberal Democrats were unhappy with the bipartisan deal. Hard-line Republicans say there aren't enough cuts; Democrats balked over changes to recipients of food stamps.

The House Freedom Caucus said the bill falls well short of the spending cuts they demanded, and they vowed to try to halt passage.

'This deal fails, fails completely," said Pennsylvania Representative Scott Perry, the chairman of the Freedom Caucus. "We will do everything in our power to stop it."

"Nobody could have done a worse job," said Representative Dan Bishop of North Carolina, who said he was fed up with what he said were McCarthy's "lies" about the deal he was going to get.

The bill would impose some new work requirements for older Americans, those age 50-54, receiving food stamps and those in the Temporary Assistance for Needy Families program.

Progressive and liberal Democrats decried the new work requirements.

Representative Cori Bush of Missouri, a member of the Progressive Caucus, said she was leaning against the bill.

"As somebody who was a food stamp recipient, there is absolutely no way I can see myself greenlighting something that will take food from people's mouths," she said.

The nonpartisan Congressional Budget Office (CBO) said the spending restrictions in the package would reduce deficits by $1.5 trillion over the decade, a top goal for the Republicans trying to curb the debt load.

But in a surprise, the CBO said that the GOP's drive to tighten requirements for food stamp eligibility for some adults — but loosening them for others, including veterans and homeless people — would increase federal spending on the program by $2.1 billion. Overall, the budget office estimated the deal would make an additional 78,000 people eligible for food stamps.

Agencies contributed to this story.

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