Democrats and Republicans have finally come to a short-term agreement to raise the debt ceiling until December, following what were weeks of theatrics and hysteria from the Senate.
As expected, both sides on Capitol Hill have come to an agreement to raise the US debt ceiling until December, thus averting a catastrophic government debt default, which could have come as early as October 18, according to Janet Yellen. “We have reached an agreement to extend the debt ceiling through early December, and it is our hope that we can get this done as soon as today,” said Senate Democrat Chuck Schumer on Thursday.
The draft of the proposed legislature, which was seen by the Financial Times, showed that America’s debt limit would be raised by $480 billion once approved by both Chambers of Congress. The latest agreement follows Republican Senate minority leader Mitch McConnell’s proposal to boost the country’s borrowing limit on a short-term basis, after Democrats urged Republicans to sign off on raising the debt ceiling while also including the Biden administration’s $3.5 trillion Build Back Better spending plan.
Despite reaching a consensus with Republicans for the time being, Democrats will only have a few months to devise a long-term solution on how to fund the government’s spending endeavours. In the event that Congress fails to come up with a new deal before the December deadline, lawmakers will once again face the possibility of a government shutdown, which would force hundreds of thousands of federal workers out of employment.
Information for this briefing was found via the Financial Times. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.