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Debt Ceiling Deal Clears Senate

We're good until December
By Newser Editors and Wire Services
Posted Oct 7, 2021 10:30 AM CDT
Updated Oct 7, 2021 7:47 PM CDT
Schumer Confirms Agreement on Debt Ceiling, for Now
Senate Majority Leader Sen. Chuck Schumer of New York walks out of a Senate Democratic meeting pumping his fist at the Capitol in Washington on Wednesday as a showdown looms with Republicans over raising the debt limit.   (AP Photo/Andrew Harnik)

(Newser) Update: The Senate dodged a US debt disaster Thursday night, voting to extend the government’s borrowing authority into December and temporarily avert an unprecedented federal default that experts warned would devastate the economy and harm millions of Americans. The vote of 50-48 in support of the bill to raise the government's debt ceiling by nearly a half-trillion dollars brought instant relief in Washington and far beyond. Congress has just days to act before the Oct. 18 deadline after which the Treasury Department has warned it will quickly run short of funds to handle the nation’s already accrued debt load. The House is likely to return to approve the measure next week. The White House signaled Biden's support, with principal deputy press secretary Karine Jean-Pierre saying the president would sign a bill to raise the debt limit when it passed Congress. Our original story from earlier today follows:

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Senate Majority Leader Chuck Schumer said Thursday an agreement has been reached with Republicans to extend the government's borrowing authority into December, temporarily averting a debt crisis. "We've reached agreement," Schumer announced as he opened the Senate, reports the AP. "Our hope is to get this done as soon as today." Senate GOP leader Mitch McConnell had offered to accept a short-term extension on Wednesday, shortly before Republicans prepared to block legislation to suspend the debt limit until December of next year.

The agreement sets the stage for a sequel of sorts in December, when Congress will again face pressing deadlines to fund the government and raise the debt limit before heading home for the holidays. McConnell and Senate Republicans have insisted that Democrats would have to go it alone to raise the debt ceiling and allow the Treasury to renew its borrowing so that the country could meet its financial obligations. Further, McConnell has insisted that Democrats use the same cumbersome legislative process called reconciliation that they used to pass a $1.9 trillion COVID-19 relief bill and have been employing to try to pass Biden’s $3.5 trillion measure to boost safety net, health, and environmental programs.

McConnell said in his offer Wednesday that Republicans would still insist that Democrats use the reconciliation process for a long-term debt-limit extension. However, he said Republicans are willing to "assist in expediting" that process, and in the meantime Democrats may use the normal legislative process to pass a short-term debt-limit extension with a fixed dollar amount to cover current spending levels into December. Democratic Sen. Chris Murphy's take: Assuming final details in the emergency legislation are in order, "for the next three months, we'll continue to make it clear that we are ready to continue to vote to pay our bills and Republicans aren't." McConnell: "This will moot Democrats' excuses about the time crunch they created and give the unified Democratic government more than enough time to pass stand-alone debt-limit legislation through reconciliation." (Read more debt limit stories.)

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