The House of Representatives voted on Tuesday to suspend the federal debt limit, maintain the funding of the government, and provide disaster and refugee assistance. This initiates a risky showdown with GOP members who are against the package notwithstanding the susceptibility of instigating a fiscal crisis.
On Friday, the Biden administration transferred to Congress a $6 trillion budget plan that will increase the level of budget allocation on education, infrastructure, and tackling climate change. It contended that it makes good budgetary reasoning to invest now when the cost of borrowing is inexpensive and diminish deficits after.
Suspending the Borrowing Limit
Democrat congressional lawmakers divulged plans in suspending the borrowing limit of the US. This is after a White House word of caution of economic chaos unless that ceiling is raised. The legislation would also financially back the government through the year-end following the current September 30 budget slips. However, the plan’s fate is unclear since GOP members have pledged to withhold support for raising the debt ceiling. This is necessitated to financially support spending already approved by lawmakers involving the large rescue packages disseminated amid the COVID-19 pandemic.
Raising the Federal Debt Ceiling
The presidential Treasury Secretary Janet Yellen is raising concern and attempting to mortify the GOP into voting to raise the federal debt ceiling. Yellen contended, “The U.S. has always paid its bills on time and the overwhelming consensus among economists and Treasury officials of both parties is that failing to raise the debt ceiling would produce widespread economic catastrophe.” In less than half a year, Democrats have proposed an estimated $11 trillion of spending.
No president of the United States has crammed as much of his domestic and foreign plans into a single piece of legislation as Biden has with the $3.5 trillion spending plan. Democrats are attempting to wrangle this through Congress in the course of the following six weeks. The bill merges significant initiatives on education, the economy, climate change, social welfare, and foreign policy.