UNITED STATES NEWS

Biden signs debt ceiling bill that pulls US back from brink of unprecedented default

Jun 3, 2023, 11:58 AM

WASHINGTON (AP) — With just two days to spare, President Joe Biden signed legislation on Saturday that lifts the nation’s debt ceiling, averting an unprecedented default on the federal government’s debt.

The White House announced the signing, done in private at the White House, in an emailed statement in which Biden thanked congressional leaders for their partnership.

The Treasury Department had warned that the country would start running short of cash to pay all of its bills on Monday, which would have sent shockwaves through the U.S. and global economies.

Republicans refused to raise the country’s borrowing limit unless Democrats agreed to cut spending, leading to a standoff that was not resolved until weeks of intense negotiations between the White House and House Speaker Kevin McCarthy, R-Calif.

The final agreement, passed by the House on Wednesday and the Senate on Thursday, suspends the debt limit until 2025 — after the next presidential election — and restricts government spending. It gives lawmakers budget targets for the next two years in hopes of assuring fiscal stability as the political season heats up.

Raising the nation’s debt limit, now at $31.4 trillion, will ensure that the government can borrow to pay debts already incurred.

“Passing this budget agreement was critical. The stakes could not have been higher,” Biden said from the Oval Office on Friday evening. “Nothing would have been more catastrophic,” he said, than defaulting on the country’s debt.

“No one got everything they wanted but the American people got what they needed,” Biden said, highlighting the “compromise and consensus” in the deal. “We averted an economic crisis and an economic collapse.”

Biden used the opportunity to itemize the achievements of his first term as he runs for reelection, including support for high-tech manufacturing, infrastructure investments and financial incentives for fighting climate change. He also highlighted ways he blunted Republican efforts to roll back his agenda and achieve deeper cuts.

“We’re cutting spending and bringing deficits down at the same time,” Biden said. “We’re protecting important priorities from Social Security to Medicare to Medicaid to veterans to our transformational investments in infrastructure and clean energy.”

Even as he pledged to continue working with Republicans, Biden also drew contrasts with the opposing party, particularly when it comes to raising taxes on the wealthy, something the Democratic president has sought.

It’s something he suggested may need to wait until a second term.

“I’m going to be coming back,” he said. “With your help, I’m going to win.”

Biden’s remarks were the most detailed comments from the Democratic president on the compromise he and his staff negotiated. He largely remained quiet publicly during the high-stakes talks, a decision that frustrated some members of his party but was intended to give space for both sides to reach a deal and for lawmakers to vote it to his desk.

Biden praised McCarthy and his negotiators for operating in good faith, and all congressional leaders for ensuring swift passage of the legislation. “They acted responsibly, and put the good of the country ahead of politics,” he said.

Overall, the 99-page bill restricts spending for the next two years and changes some policies, including imposing new work requirements for older Americans receiving food aid and greenlighting an Appalachian natural gas pipeline that many Democrats oppose. Some environmental rules were modified to help streamline approvals for infrastructure and energy projects — a move long sought by moderates in Congress.

The Congressional Budget Office estimates it could actually expand total eligibility for federal food assistance, with the elimination of work requirements for veterans, homeless people and young people leaving foster care.

The legislation also bolsters funds for defense and veterans, cuts back some new money for the Internal Revenue Service and rejects Biden’s call to roll back Trump-era tax breaks on corporations and the wealthy to help cover the nation’s deficits. But the White House said the IRS’ plans to step up enforcement of tax laws for high-income earners and corporations would continue.

The agreement imposes an automatic overall 1% cut to spending programs if Congress fails to approve its annual spending bills — a measure designed to pressure lawmakers of both parties to reach consensus before the end of the fiscal year in September.

In both chambers, more Democrats backed the legislation than Republicans, but both parties were critical to its passage. In the Senate the tally was 63-36 including 46 Democrats and independents and 17 Republicans in favor, 31 Republicans along with four Democrats and one independent who caucuses with the Democrats opposed.

The vote in the House was 314-117.

We want to hear from you.

Have a story idea or tip? Pass it along to the KTAR News team here.

United States News

FILE - Rupert Murdoch attends the WSJ. Magazine 2017 Innovator Awards at The Museum of Modern Art i...

Associated Press

Rupert Murdoch, creator of Fox News, stepping down as head of News Corp. and Fox Corp.

Rupert Murdoch, the 92-year-old media magnate who created Fox News, is stepping down as leader of both Fox's parent company and his News Corp. media holdings.

3 hours ago

Associated Press

Stock market today: World shares track Wall Street’s slump after Fed says rates may stay high in ’24

World shares have declined, echoing a slump on Wall Street after the Federal Reserve said it may not cut interest rates next year by as much as it earlier thought. Benchmarks fell by 1% or more in Paris, Tokyo, Sydney and Hong Kong. U.S. futures slipped and oil prices also were lower. On Wednesday, the […]

10 hours ago

FILE - Deja Taylor arrives at federal court, June 12, 2023, in Virginia Beach, Va. Taylor, the moth...

Associated Press

Mother of 6-year-old boy who shot his teacher in Virginia could be jailed for failing drug tests

NEWPORT NEWS, Va. (AP) — The mother of a 6-year-old who shot his teacher in Virginia could be jailed Thursday for failing drug tests while awaiting sentencing on federal weapons charges that she used marijuana while possessing a firearm. A bond revocation hearing is set in federal court in Newport News for Deja Taylor. Her […]

11 hours ago

FILE - Anthony Sanchez, right, is escorted into a Cleveland County courtroom for a preliminary hear...

Associated Press

Man set to be executed for 1996 slaying of University of Oklahoma dance student

McALESTER, Okla. (AP) — Oklahoma is set to execute an inmate Thursday morning for the 1996 slaying of a University of Oklahoma dance student, a case that went unsolved for years until DNA from the crime scene matched a man serving time for burglary. Anthony Sanchez, 44, is scheduled to receive a three-drug injection at […]

11 hours ago

A Brightline train approaches the Fort Lauderdale station on Friday, Sept. 8, 2023, in Fort Lauderd...

Associated Press

First private US passenger rail line in 100 years is about to link Miami and Orlando at high speed

MIAMI (AP) — The first big test of whether privately owned high-speed passenger train service can prosper in the United States will launch Friday when Florida’s Brightline begins running trains between Miami and Orlando, reaching speeds of 125 mph (200 kph). It’s a $5 billion bet Brightline’s owner, Fortress Investment Group, is making, believing that […]

11 hours ago

The entrance to the Las Vegas Review-Journal campus is shown in Las Vegas, Wednesday, Aug. 30, 2023...

Associated Press

Outdated headline sparks vicious online hate campaign directed at Las Vegas newspaper

NEW YORK (AP) — A Las Vegas newspaper is being viciously attacked online for its coverage of an alleged murder of a retired police chief, either because of a misunderstanding or a deliberate attempt to mislead. The “firehose of hatred” has led the Las Vegas Review-Journal to sift through email directed at one of its […]

11 hours ago

Sponsored Articles

...

SCHWARTZ LASER EYE CENTER

Key dates for Arizona sports fans to look forward to this fall

Fall brings new beginnings in different ways for Arizona’s professional sports teams like the Cardinals and Coyotes.

...

Ignite Digital

How to unlock the power of digital marketing for Phoenix businesses

All businesses around the Valley hopes to maximize their ROI with current customers and secure a greater market share in the digital sphere.

...

Ability360

At Ability360, every day is Independence Day

With 100 different programs and services, more than 1,500 non-medically based home care staff, a world-renowned Sports & Fitness Center and over 15,000 people with disabilities served annually, across all ages and demographics, Ability360 is a nationwide leader in the disability community.

Biden signs debt ceiling bill that pulls US back from brink of unprecedented default