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Debt Ceiling Deal Reached Between Biden, House Republicans To Avoid U.S. Default

Debt Ceiling Deal [Photo: WAVE 3]
Debt Ceiling Deal [Photo: WAVE 3]

A debt ceiling deal was ultimately reached between U.S. President Biden and the House Republicans in June. However, despite the agreement, lawmakers are still urged to completely eliminate the debt ceiling.

Biden and House Republicans Agreed on Debt Ceiling Deal [Photo: BusinessWorld Online]

Biden and House Republicans Agreed on Debt Ceiling Deal [Photo: BusinessWorld Online]

On June 3, the White House announced that U.S. President Joe Biden signed a debt ceiling deal that raised the debt limit and ultimately avoided an economic default on the federal government’s debt. The Republicans initially refused to agree with a debt ceiling deal unless the Democrats would allow cuts in spending.

Fortunately, an article in Al Jazeera states that the debt ceiling deal was passed by the House on May 30 and by the Senate on June 1. The debt ceiling deal agreed to suspend the debt limit until 2025 or after the next presidential election and limit the government from spending.

READ ALSO: SNAP Benefits 2023: Changes In Requirements Under New Debt Ceiling Deal

Despite Debt Ceiling Deal

However, according to Boddie, the debt ceiling deal is still not proof for the U.S. to be fiscally sustainable. This suggests that lawmakers must decide whether to completely eliminate the debt ceiling or to compromise the deal.

Otherwise, if there will be no compromises for the debt ceiling deal, the U.S. government will continue spending more on interest every year than on national defense. In addition, by the next decade, the federal budget deficits will amount to around $2 trillion per year, adding to the $25.4 trillion in loan that is already owed to investors.

READ ALSO: What The Debt Ceiling Deal Means For Student Loan Borrowers

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