Suspension of US debt limit wins final congressional approval

Feb 01 2013, 10:00 IST
Comments 0
Suspension of US debt limit wins final congressional approval. (Reuters) Suspension of US debt limit wins final congressional approval. (Reuters)
SummaryA bill allowing the US government to keep borrowing money for at least a few more months.

A bill allowing the US government to keep borrowing money for at least a few more months, beyond its record $16.4 trillion debt limit, won final congressional approval on Thursday, clearing the way for President Barack Obama to sign it into law.

The Democratic-led Senate passed the bill, 64-34, a week after the Republican-controlled House of Representatives approved it, 285-144. Both votes were bipartisan.

The legislation would put off until at least May 19 a showdown over the debt limit between Republicans, who demand more spending cuts to shrink deficits, and Democrats, who favor reducing deficits with a mix of spending cuts and tax hikes.

Senate Minority Leader Mitch McConnell joined 32 fellow Republicans and one Democrat, Joe Manchin of West Virginia, in voting no. Twelve Republicans, 50 Democrats and two independents voted yes.

McConnell opposed the bill because it did not contain spending cuts, spokesman John Ashbrook said. "What's needed now is a long-term solution to Washington's out-of-control spending and debt," Ashbrook said.

Senate Democratic leader Harry Reid said passage of the bill shows Washington will not engage "in another irresponsible debate about whether the United States government should pay its bills."

Drafted by House Republican leaders, the bill marks a major retreat from their vow to use the debt limit to extract more spending cuts. A fight over the debt limit in August 2011 led to a downgrade in the US government's credit rating and sent markets tumbling.

By suspending enforcement of the debt limit, expected to be reached as early as mid-February, the government would keep borrowing money and paying its bills until at least May 19, when the limit would again be enforced.

Under the bill, the debt limit would have to be reset on May 19 to whatever level the debt reaches by then, likely about $17 trillion.

The president has refused to negotiate on the debt limit.

Several other budget skirmishes are likely over the next five weeks. Congress must consider what to do about automatic budget cuts set for the beginning of March and a measure to continue funding the operations of the government that must be in place by March 27.

In the past two years, House Republicans have drawn the wrath of many voters and financial markets for pushing the government to the brink of a shutdown and an unprecedented default.

Many Republicans have said they want to avoid either scenario this year. But they are also demanding more spending cuts and

Single Page Format
Ads by Google
Reader´s Comments
| Post a Comment
Please Wait while comments are loading...