As soon as next month, Congress will be grappling going over its debt cliff. Congress agreed to let the government borrow through July 31 under a 2019 negotiation during former President Donald Trump's administration. But by the end of July, Washington will possibly hit the debt limit. This means the federal government will surpass the permitted threshold of the amount allowed to spend in around five weeks unless Congress takes action. President Joe Biden and Democratic leaders in Congress will be facing a challenge as soon as that deal expires.
Psaki: Biden Believes Congress Will Lift Debt Limit
According to White House press secretary Jen Psaki on Monday, President Biden expects Congress to lift the legal limit on the federal debt notwithstanding the impending bout with the GOP overspending. The secretary, during a Monday White House briefing, stated that Biden believes lawmakers will once again alleviate the United States from defaulting on its debt. This is following legislators suspending or raising the debt ceiling three times under the previous president.
At that point, the Treasury Department could take what is known as remarkable measures to maintain the government's solvency. However, it is not clear how long it will be able to maintain this. In the Senate, raising the debt limit is conditional on the filibuster. This means that Democrats will need Republican support, reported MSN.
Bouts over the debt ceiling are usually contentious as members of Congress battle over the details Scrapping over the debt ceiling is entirely different compared to other legislative bouts, reported Fox News.
According to Psaki, "The President believes that Congress will do what they've done three times during the Trump administration, which is to raise the debt ceiling. We know that that will be a central focus and discussion, probably even in here, come the fall, but he expects they will do what they've done three times [under Trump]," reported The Hill.
Republican senators remarked they do not expect their assembly to provide the 10 votes required to hike the borrowing limit. According to Sen. John Thune (S.D.), the No. 2 Senate Republican, it is unlikely that the GOP will support raising the debt ceiling.
The legal threshold on how much debt the United States government can hold is slated to kick back in on August 1. This provides Congress and Biden less than two months to keep the government from going over its debt cliff. GOP lawmakers agreed to lift the debt ceiling three times under Trump's tenure. However, they have cautioned Democrats they will not do so again unless Democrats agree to debt reduction measures, including spending cuts.
Another member of leadership, Sen. Roy Blunt (R-Mo.), contended that lawmakers regularly use the debt ceiling to attempt to figure out a form of mechanism to control future debt. Contending with this issue establishes a high-profile financial bout with remarkable implications for the global economy.