House Passes Bill To Avert Debt Ceiling Crisis

US News & Politics
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House Passes Bill To Avert Debt Ceiling Crisis

Sara Dorn

The House agreed to suspend the debt ceiling until 2025 on Wednesday in a decisive bipartisan vote on legislation negotiated by House Speaker Kevin McCarthy (R-Calif.) and President Joe Biden, amid a last-minute push to stave off an anticipated financial collapse before a looming June 5 deadline.

Key Facts

The House voted 314-117, with 165 Democrats and 149 Republicans voting in favor of the legislation.

The bill—which now heads to the Senate—would suspend the $31.4 trillion cap on federal borrowing through January 2025, preventing the government from running out of money and defaulting on its obligations early next week, and implement caps on federal spending and rollbacks of some of Biden’s policy priorities.

McCarthy and Biden negotiated the legislation after the GOP-led House passed a debt ceiling bill in April that included much steeper spending cuts and more drastic policy reversals—legislation that served as a negotiating tool for McCarthy in his dealings with the White House.

Many of the opposing votes came from the right and left flanks of each party: On the Democratic side, Reps. Jamaal Bowman (N.Y.), Cori Bush (Mo.) and Alexandria Ocasio-Cortez (N.Y.) voted against the bill, while hard-right Republican Reps. Andy Biggs (Ariz.), Matt Gaetz (Fla.) and Andrew Clyde (Ga.) also voted “no.”

What We Don’t Know

When the Democratic-controlled Senate will vote on the legislation, which it must pass before the Monday deadline Treasury Secretary Janet Yellen has set for when the federal government could default on its debt. Sens. Tim Scott (R-S.C.), who is running for the GOP nomination for president, and Bernie Sanders (I-Vt.) both said they will vote against the legislation. Senate Majority Leader Chuck Schumer

Tangent

The legislation appeared on track toward passage in the House after clearing a procedural hurdle earlier Wednesday, when the House approved the rules governing debate—which is typically a routine practice in which the majority party votes as a bloc to approve the rule. But 29 Republican holdouts, many of whom are right-wing House Freedom Caucus members, voted against the rule in a last-minute bid to stymy the legislation. Fifty-two Democrats joined Republicans in approving the measure, 241-187.

Key Background

Leaders on both sides of the aisle sold the legislation as a win for their respective parties, while acknowledging that both sides would not get everything they want, given the nature of a divided Congress. “Mr. Speaker, the Rolling Stones said, you can’t always get what you want, you get what you need. And we need to avert a default,Democrats urged lawmakers to consider what was left out of the deal, rather than the GOP-backed spending cuts that were included, while Republican negotiators in Congress billed provisions, such as enhanced work requirements for food stamp recipients and a faster permitting process for energy projects, as conservative wins. The legislation caps federal non-defense spending in fiscal year 2024 at its current level and allows for a 1% increase in fiscal year 2025. The bill would cut federal spending by $1.5 trillion over the next decade, according to the Congressional Budget Office, recoup some unused Covid-19 money and lift a freeze on federal student loan repayments in August. Headed into Wednesday’s House vote, McCarthy and House Minority Leader Hakeem Jeffries (D-N.Y.) both expressed confidence that it would pass with a bipartisan consensus, despite a revolt among right-wing lawmakers and discontent among the Congressional Progressive Caucus.

Surprising Fact

At least one right-wing lawmaker, Rep. Dan Bishop (R-N.C.), threatened to trigger a mechanism to remove McCarthy as speaker over the debt ceiling bill, claiming the legislation does not go far enough in addressing the GOP’s demands for cuts to the federal budget and Biden’s policies. Other Republicans, including Reps. Chip Roy (Texas) and Paul Gosar (Ariz.) also suggested McCarthy could face consequences, though Bishop was the only member to publicly endorse a movement to remove him as speaker headed into Wednesday’s vote. Per an agreement McCarthy negotiated with his right-wing detractors during his hard-fought speakership election in January, one member of the conference (rather than the majority or a party leader) can bring a “motion to vacate,” which would require a simple majority to pass.

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Biden signs $1.7 trillion government spending bill into law

Not a dime touched by Mc Carthy.

Fulfills 98 percent of Democratic Member requests in the House, with $5.4 billion for 3,213 Democratic projects
Not a dime touched by Mc Carthy.

2.5 million for “the repair, alteration, and improvement” of the White House residence.
$1 million for Zora’s House in Ohio, a “coworking and community space” for “women and gender-expansive people of color.”
$3 million for the American LGBTQ+ Museum in New York City.
$3.6 million for a Michelle Obama Trail in Georgia.

Untouched.

$2 million foreign service grant program the “Nancy Pelosi Fellowship Program.”
$2 million for the “rehabilitation of Bering Sea Women’s Shelter for Bering Sea Women’s Group

Untouched.

Mc Carthy has much to be proud of.

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She what was the hot air for being expressed by opposing members?

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Sheep one and all . :face_with_symbols_over_mouth: :face_with_symbols_over_mouth: :face_with_symbols_over_mouth: :face_with_symbols_over_mouth: :face_with_symbols_over_mouth:

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Expect the Federal reserve to react as congress agrees to spend more fueling inflation.

Another half percent ahead.

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Once again both parties avoid, ignore the coming disaster:

Social Security and Medicare Are Ticking Time Bombs

Even taking all the money from every billionaire wouldn’t cover our coming bankruptcy.

JOHN STOSSEL | 5.31.2023 12:30 PM

Social Security is toast.

So is Medicare.

Too many of us old people live longer, so there are not enough working people to support us.

Soon both Social Security and Medicare will be broke.

Our politicians don’t have the guts to do anything about it. Or even talk about it.

It’s easy to see why.

Recently, France’s president, trying to keep his country’s pension system from going broke, raised France’s retirement age from 62 to a measly 64.

People have been protesting ever since.

In America, politicians who even hint at such solutions get screamed at by misinformed seniors: “Don’t touch my retirement funds! You took money from my paycheck for years; that’s my money I’m getting back!”

But it’s not. It’s young people’s money. People my age rarely realize that most of us now get back triple what we paid in.

When Social Security began, a government retirement plan made financial sense. Most Americans didn’t even live until age 65. Social Security was just for the minority who did.

But now Americans live, on average, to age 76. I’m 76. Henry Kissinger is 100. Since most of us live so long, there are just not enough workers to pay for us.

Yet our vote-hungry politicians won’t say that in public.

Even former President Donald Trump cowers, saying, “No one will lay a hand on your Medicare or your Social Security.”

The most clueless, like Sen. Bernie Sanders (I–Vt.), even deny the obvious truth. He shouts: “Social Security today is not on the line going broke!”

But it just is. Reserve funds are projected to run out by 2034.

Medicare’s reserves will run out even sooner.

Of course they will. When I first got Medicare, I was surprised how no one even pays attention to costs. Everything seems free.

“Get an MRI,” says my doctor. I immediately do. I don’t ask the cost. The MRI people don’t mention it either.

Months later, I get a complex notice that says my MRI cost $2,625 and I must pay $83.65. Or sometimes, nothing. Who did pay? Blue Cross? Taxpayers? The paperwork is so complex that I don’t even know.

Old people who scour supermarkets to save a dollar on groceries never comparison shop for MRIs or heart surgery. “Why should I? Someone else pays.”

As my new video illustrates, Medicare is a bomb with a burning fuse moving closer.

“Sooner or later, it will blow up,” says economist Dan Mitchell of the Center for Freedom and Prosperity. “Politicians figure oh, well, maybe it blows up in five years or 10 years or 20 years. I won’t be in office anymore.”

Some claim raising taxes on rich people would solve the deficit, but it won’t. There just aren’t enough rich people. Even taking all the money from every billionaire wouldn’t cover our coming bankruptcy.

The only solution is cutting benefits, raising the age when benefits start (sensible, since we live longer), or, Mitchell’s preference, privatizing retirement plans, like Australia and Chile did.

America’s politicians won’t do any of those things.

So what will happen?

“The only other alternative is printing money,” says Mitchell.

“I suspect that’s what America will do,” I tell Mitchell. “We’ll be like Zimbabwe.” Zimbabwe’s president printed money to fund his deficit spending. When the currency collapsed in 2009, Zimbabwe was printing hundred trillion-dollar bills.

Yet politicians don’t learn. In the current debt ceiling deal, House Speaker Kevin McCarthy (R–Calif.) got President Joe Biden to “claw back” unused COVID relief funds and keep two years of non-defense discretionary spending roughly flat.

That’s a little progress. But Biden wants to spend a record $7 trillion next year.

McCarthy said Medicare and Social Security were “completely off the table.”

So the programs are still doomed.

“Sooner or later bad things will happen to senior citizens,” explains Mitchell. “The government will either cut their benefits or all of a sudden start rationing health care. Or reimbursement rates will be so low that you won’t be able to find a doctor or hospital to treat you.”

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We are fucked . We no longer have representation !!!

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As congress cannot control spending, the Fed may step up raising interest rates forcing congress to cut spending.

1 Like
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That says it all !!! They are unstoppable and their is NO opposition to even slow them down . We are a 1 party Country . GOP just barely goes through the motions .

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The McCarthy-Biden Debt Ceiling Deal Sends America Into Economic Demise (townhall.com)

The McCarthy-Biden Debt Ceiling Deal Sends America Into Economic Demise

I opposed the last debt ceiling plan in the House because it raised the national debt by $1.5 trillion over a few months, but the deal that Speaker McCarthy has made with President Biden is an even bigger disaster.

The original bill that passed out of the House last month promised fiscal year 2022 spending levels with a savings of approximately $131 billion and rescissions of almost $900 billion.

The McCarthy-Biden plan nets only $9 billion in savings and only $29 billion in rescissions. And there is the likelihood that the savings totally go away, and the bill indicates that $22 billion of the rescissions will be repurposed to get around the putative spending caps in the bill.

The McCarthy-Biden plan blows up the debt ceiling from the already outrageous national debt of $31.4 trillion to a more treacherous national debt of $36 trillion by January 1, 2025.

But the McCarthy-Biden deal is designed to fool you. Instead of estimating the actual dollar amount of the increase in our national debt that will happen before January 1, 2025, they simply say that there is no cap on the national debt until January 1, 2025. How much can they spend?

And while the current growth rate of our national debt projects to slightly more than $4 trillion in new debt by then, it could easily exceed $4 trillion.

Let’s see here, the original House bill included elimination of all IRS funding for the new Gestapo agents who will be a weaponized IRS force. Total savings would have been $71 billion and no new agents to hassle Americans. The McCarthy-Biden proposal prevents hiring of the force next year–not permanently–for a savings of $2 billion. And, Republicans will have to fight to prevent the hiring of the agents a year from now! But, even that is disingenuous as the $71 billion has already been preauthorized, which means that the money is there to hire IRS agents
The original House bill included rescissions of Green New Deal tax credits and subsidies, which largely benefit rich individuals and corporations–Bill Gates is one of the biggest recipients rumored to be eligible for $1 billion in benefits–for a savings of more than $200 billion. The McCarthy-Biden plan continues the Green New Deal boondoggles.

The House bill originally eliminated Biden’s student loan forgiveness and restructuring plan for a projected savings of more than $400 billion. The McCarthy-Biden deal doesn’t.

The spending levels frozen at 2022 rates in the original House legislation are modified up.

And, Republican members of Congress are told that we will fight these issues again next year. In the meantime, the McCarthy-Biden plan assures an increase in the national debt by more than $4 trillion.

How come Republican leaders always tell us that next year we’ll fight hard…we really mean it!?

In fairness, the McCarthy-Biden plan asserts something that they call “Administrative Pay-Go.” It ostensibly will require bureaucrats to demonstrate how they will pay for new programs or increases in spending. Sounds good, right, except Congress has had a similar program for many years without it slowing down our spending. Why? Because Congress waives the “pay-go” provisions, as it will no doubt do in the “Administrative Pay-Go” process. Look for a failure here as well. And the craziest part of the “Administrative Pay-Go” is that the Director of the OMB can waive the pay-go provisions whenever and for whatever reason. No wonder that the Biden Administration has no concern over this provision.

And that unicorn, the “Administrative Pay-Go”, is where most of the McCarthy-Biden savings of $1.5 trillion. Since that is ephemeral at best, the McCarthy-Biden savings evaporate.

Another point that the McCarthy-Biden coalition supports disincentivizes the commitment to pass 12 appropriation bills as promised in January. It automatically creates a continuing resolution if a budget package is not passed by the close of the fiscal year in September. But, this doesn’t even take effect until 3 months into the next fiscal year, and is based on the raised spending levels.

When Republican leaders put out their talking points they said that the Democrats got nothing in this deal. (They apparently forgot about the $4 trillion increase in the spending cap).

As Progressive Democrat Pramila Jayapal (D-WA) has stated: “It doesn’t cut spending and doesn’t reduce the deficit.”

The McCarthy-Biden proposal doesn’t stop, or even slow down, deficit spending.

The McCarthy-Biden proposal doesn’t reduce the angle of trajectory of our out-of-control growth of our nation’s debt.

The McCarthy-Biden proposal doesn’t bend the spending curve down.

Instead, they put some curtains on a dilapidated budget house that will leave us with what Joe Biden wanted all along: an unsustainable, indefensible growth in our national debt.

The McCarthy-Biden plan keeps us moving over the national debt cliff with the Republican leadership’s mantra of “We’ll fight harder next year!”

I thought the last plan wasn’t a good plan because it increased the national debt by $1.5 trillion in a few months, but who knew that the McCarthy-Biden team would produce an even more malodorous plan that will accelerate our nation’s debt, and consequently our economic demise?!