Bill on the US debt ceiling advances in Congress

I would be “happy to meet with (the speaker of the House of Representatives, Kevin) McCarthy, but not to talk about raising or not raising the debt ceiling. That is non-negotiable,” Biden said Wednesday at a joint press conference. at the White House with his South Korean counterpart, Yoon Suk Yeol.

In the United States, Congress must periodically increase the country’s authorized debt ceiling, so as not to leave the world’s largest economy in default.

The White House has asked Republicans not to link the budget to the debt-ceiling process, which often pits the two parties in Congress against each other.

In January, the United States hit its borrowing limit of $31.4 trillion, prompting the Treasury to take action.

The United States runs the risk of defaulting on its debt obligations since July if the Legislature does not resolve to raise the federal debt limit, the Congressional Budget Office (CBO) said in mid-February.

Since the Presidency of Barack Obama, this procedure that was once a formality often becomes a political test at the behest of the Republicans, although an agreement is always reached.

A default would cause “an economic and financial catastrophe,” warned Treasury Secretary Janet Yellen.

electoral context

In addition to public finances in the short term, the 2024 presidential election is drawn on the landscape, with Biden already as a declared candidate for his own succession.

McCarthy, on his side, seeks to consolidate his authority among the Republicans with an idea that achieves a consensus in his party: force the Biden government into an austerity cure.

His plan calls for a $4.5 trillion cut in estimated spending over a 10-year term, with the exception of military spending, in exchange for an increase in borrowing capacity of $1.5 trillion.

The US debt is, due to its solvency, a refuge for the global financial sector.

Since the 1960s, Congress has voted for this type of measure almost 80 times to increase the country’s borrowing capacity.