United States: the Senate rules out, for a time, the threat of a default

The House of Representatives, with a Democratic majority, must now give the green light to the text.

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A few weeks of respite. After days of tension, the US Senate on Thursday, October 7 dismissed the threat of a default by the United States, by approving a text that will raise the debt ceiling of the world’s largest power until December.

Only Democratic senators approved the plan, which would raise the country’s debt limit by $ 480 billion and allow it to honor its payments until early December.

The House of Representatives, with a Democratic majority, must now give it the green light. The vote will take place on Tuesday and the text will be sent immediately to President Biden, who is expected to sign the text immediately.

Republicans are refusing to endorse any long-term measures to raise the debt ceiling because they claim it would be like giving Joe Biden a blank check to fund his sweeping investment plans. These plans have yet to be passed by Congress, however, so raising the debt limit serves to repay sums already borrowed, including trillions of dollars spent under the Trump presidency.

The agreement reached on Thursday only postpones until the end of November a parliamentary battle that promises to be epic over the finances of the United States. Because in parallel with the debt limit, Congress will also have to agree by early December on a new budget if it wants to avoid the paralysis of federal services, nicknamed “shutdown”.

The Democrats hope, however, to take advantage of this respite on the financial front to focus in the coming weeks on the difficult negotiations within their party and adopt the two major investment plans wanted by Joe Biden, in infrastructure and social reforms.

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