– This bipartisan agreement is a major victory for the economy and Americans, tweeted President Joe Biden. After weeks of negotiations and growing economic anxiety, Democrats and Republicans have agreed: the bill that would raise the US debt ceiling has passed the Senate. That means the federal government can continue paying its bills on Monday. Preisdent Joe Biden announced that he will sign the law as soon as possible and give a speech to the nation on Friday. Meanwhile, he expressed his gratitude to the two parties. – Tonight, senators from both parties voted to protect the hard-earned economic progress we have made and prevent a default by the United States. Together, they demonstrated once again that America is a nation that pays its bills and fulfills its obligations. A poster at a bus stop in Washington DC shows the national debt to Americans. Photo: MANDEL NGAN / AFP What does the agreement entail? The most important thing about this new agreement is that the US can continue to borrow money. The Americans are one of the few countries in the world that must adopt a debt ceiling. This is money that goes to finance the government and the state. The current debt ceiling of 31,400 billion dollars, approximately NOK 336,435 billion, was reached in January. Thus, American politicians had to sit down to reach a new agreement. The New York Times writes that the new agreement suspends the debt limit until January 2025, so that the US can continue to borrow unlimited sums to pay off its debt. It also ensures that a new battle over the debt ceiling will not occur before the next presidential election. Other policy changes on permits for energy projects and work requirements on social benefits were also included. Federal spending will be cut by $1.5 billion over a decade, according to the Congressional Budget Office. With this new law, Biden’s student loan repayment ends at the same time. One of the president’s battle issues from 2022. – Can breathe a sigh of relief The Senate voted on the bill on Thursday evening. 63 voted for and 36 voted against the bill. The day before, it was passed in the House of Representatives, with 314 votes in favor and 117 against. When the proposal passed in the lower house, President Biden called for quick consideration. – The US can breathe a sigh of relief, because through this process we avoid default. From the very beginning, avoiding default has been our “north star”, says Senate leader Chuck Schumer from the Democrats. Could have triggered a crisis The bill has been dependent on approval before 5 June, which is the deadline for when the Ministry of Finance no longer has the funds to pay the nation’s debt. If that had happened, it could have triggered an economic crisis in the United States, which could have further affected the economies of other countries.
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