Crisis Averted as Senate Sends Debt Limit Package to Biden

Roll Call
 
Senators staved off a financial crisis — and a weekend of voting in Washington — on Thursday night [June 1] when the chamber signed off on a bipartisan deal to suspend the debt limit into 2025, giving the Treasury authority to borrow trillions of dollars more to pay its bills.

With only days to spare before a Monday deadline, the Senate cleared for President Joe Biden’s signature a measure that would suspend the statutory $31.4 trillion debt ceiling and impose two years of caps on discretionary spending.

The bill also would claw back unspent pandemic aid, redirect some IRS funding for other uses, streamline energy permitting, end a pause on student loan repayments and toughen some work requirements for certain recipients of food stamps and cash assistance.

Passage of the measure was virtually ensured after Biden and Speaker Kevin McCarthy, R-Calif., reached a bipartisan deal on the debt limit over the weekend to end months of partisan wrangling. It also ends fears of triggering what Treasury Secretary Janet L. Yellen warned could be an "economic catastrophe" if the debt limit were breached and government payments had to be delayed.

"It is so good for this country that both parties have come together at last to avoid default," Senate Majority Leader Charles E. Schumer, D-N.Y., said before passage.

The bipartisan Senate vote of 63-36 came after a day of backroom negotiating, as senators aired their grievances over the package and sought votes on amendments that were designed to lodge protests without blocking final passage.

The biggest threat to the bill erupted on the Senate floor around midday, when several Republican defense hawks and top appropriators said they could not vote for the measure without a commitment from leadership to take up a supplemental defense spending bill.

They said the 3 percent defense spending increase allowed in the debt limit deal for the coming fiscal year, and a 1 percent increase allowed the following year, amount to cuts after adjusting for inflation.

"We'll be here ’til Tuesday until I get commitments that we're going to rectify some of these problems,” said Sen. Lindsey Graham, R-S.C., who wanted to ensure there would be more money for the Pentagon, as well as for Ukraine, Taiwan and Israel.

Senate Appropriations Chair Patty Murray, D-Wash., said any supplemental bill would also need to include funding for domestic purposes such as border security and disaster relief.

To remove that obstacle, Schumer and Minority Leader Mitch McConnell, R-Ky., entered a statement into the record pledging that the debt ceiling package wouldn't preclude consideration of emergency supplementals, whether for defense and national security-related purposes or domestic needs.

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