Republican Speaker of the House Kevin McCarthy announces the agreement reached to raise the debt ceiling on May 28, 2023 in Washington DC. ANNA ROSE LAYDEN / AFP
A classic compromise, limited and imperfect. But a necessary compromise that will allow the United States to back down from a financial abyss. This is the agreement in principle between the White House and Republican House negotiators on Saturday, May 27, to raise the debt ceiling and in turn impose budget cuts. This agreement, which still needs to be voted on May 31 in the House of Representatives and then the Senate before Joe Biden signs it off, represents the only possible way for the state to avoid a default on its financial obligations (spending accounts) and debt ) At the beginning of June.
Unlike previous increases in the debt ceiling, this time the Republican majority in the House of Representatives wanted to tie the measure to a limit on federal spending. After long refusing, Joe Biden was forced to accept the parameters of these negotiations. The increase in this spending will be frozen in 2024 and capped at 1% in 2025, with the exception of the military sector. In turn, raising the debt ceiling in this biennium would allow this issue to be removed from the arena of partisan confrontation ahead of the November 2024 presidential election.
Tensed negotiations raged between the two parties for several weeks, riddled with mutual accusations of blackmail and irresponsibility. Excitement mounted as the timeline seemed increasingly restrictive before the United States hit the $31.381 billion debt ceiling set by Congress. So much so that some White House advisers have been investigating the hypothesis of bypassing Congress and invoking the Fourteenth Amendment to the US Constitution. It was passed in 1868 and states that “the validity of the national debt” applies […] will not be questioned”. However, this recourse would inevitably have led to legal challenges.
Instead, Joe Biden and Speaker of the House Kevin McCarthy (California) managed to reach out to each other. In a statement Saturday night, the US President welcomed the deal, which “represents a compromise” and “good news for the American people because it averts a catastrophic default that would have led to an economic recession.” Joe Biden believes the Democrats’ priorities and the legislative texts that have been passed for two years remain intact.
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