The United States’ default temporarily averted by the Senate

The US Senate has kept the threat of a catastrophic US default away for a few weeks.

It was tense but the US Senate on Thursday, October 7 removed the threat of a catastrophic default by the United States, by approving a text that will raise the debt ceiling of the world’s leading power until December.

Only Democratic senators approved the plan, which would raise the country’s debt limit by $ 480 billion and allow it to honor its payments until early December.

The Democratic-majority House of Representatives must now give it the green light, probably in the middle of next week, so that Joe Biden can then enact it. If the temporary deal reassured Wall Street, which ended up, it neither calmed the climate on Capitol Hill, nor completely satisfied the White House .

“The Republicans have played a dangerous and risky game,” thundered Senate Democrat Leader Chuck Schumer, denouncing the opposition’s categorical refusal to approve a more lasting measure with them.

Annoyed Republicans

“What we need now is a long-term solution, so that we don’t go through this risky drama on a regular basis, and we hope the Republicans will join us,” he continued.

His wrathful tone outraged some of the 11 Republicans who had just voted with the Democrats in a crucial procedural step in reaching the final vote. Among them were Republican leader Mitch McConnell, who proposed the deal to avoid “a crisis caused” by the Democrats, he said.

With this proposal, this veteran of Congress offered a temporary way out for the two camps, which were encysted in diametrically opposed positions.

But this advance has also enraged several Republicans, on the same line as Donald Trump, for whom Mitch McConnell “folded” in front of the Biden camp. “Republican senators: do not vote for this terrible agreement,” had launched the former president just before the procedural vote.

“Push back the problems”

Although the White House has said the Democratic president “looks forward” to signing the deal, it has also expressed suspicion of a temporary solution. Dec. 3 “is a short timeframe” and “uncertainty remains in the longer term,” Treasury Secretary Janet Yellen told CNN.

Republicans are refusing to endorse any long-term measures to raise the debt ceiling because they say it would be like giving Joe Biden a blank check to fund his sweeping investment plans. These plans have not yet been adopted by Congress, however, and raising the debt limit therefore serves to repay sums already borrowed, including trillions of dollars spent under the presidency of former President Trump.

Offering temporary respite to avoid a debt crisis, Mitch McConnell urged Democrats to reach a lasting solution “alone” by December through a complex legislative route. But President Joe Biden’s camp has so far refused to use this “too risky” maneuver for the debt.

The agreement reached on Thursday therefore only postpones until the end of November a parliamentary battle that promises to be epic over the finances of the United States. Because in parallel with the debt limit, Congress will also have to agree by early December on a new budget if it wants to avoid the paralysis of federal services, nicknamed “hums”.

The Democrats hope, however, to take advantage of this respite on the financial front to focus in the coming weeks on the difficult negotiations within their party and adopt the two major investment plans wanted by Joe Biden, in infrastructure and social reforms.

After days of tension, the US Senate on Thursday dismissed the threat of a catastrophic default by the United States, by approving a text that will raise the debt ceiling of the world’s largest power until December.

Only Democratic senators approved the plan, which would raise the country’s debt limit by $ 480 billion and allow it to honor its payments until early December.

The House of Representatives, with a Democratic majority, must now give it the green light. The vote will take place on Tuesday and the text will be sent immediately to President Biden, Democratic House leader Steny Hoyer said.

The president will sign the text immediately, White House spokeswoman Jen Psaki said. “We cannot allow partisan politics to hold our economy hostage, and we cannot allow the routine of paying our bills to turn into the political spectacle that shakes our confidence every two years or every two months,” he said. she said in a press release.

If the temporary agreement reassured Wall Street, which ended up, it neither calmed the climate on Capitol Hill.

“The Republicans have played a dangerous and risky game,” thundered the leader of the Democrats in the Senate, Chuck Schumer, denouncing the opposition’s categorical refusal to approve a more lasting measure with them.

“What we need now is a long term solution, so that we do not go through this risky drama regularly, and we hope the Republicans will join us,” he continued.

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