US House votes for short-term debt ceiling fix, averting default

WASHINGTON • The United States House of Representatives gave final approval on Tuesday to legislation temporarily raising the government's borrowing limit to US$28.9 trillion (S$39.1 trillion), pushing off the deadline for debt default only until December.

Democrats, who narrowly control the House, maintained party discipline to pass the hard-fought, US$480 billion debt limit increase by 219 to 206. The vote was along party lines, with every "yes" from Democrats and every "no" from Republicans.

President Joe Biden is expected to sign the measure into law before next Monday, when the Treasury Department has estimated it would no longer be able to pay the nation's debts without congressional action.

House passage warded off concerns that the US - the world's largest economy - would go into default for the first time, but the temporary extension set the stage for continued fighting between the parties.

"We have temporarily averted crisis ahead of next week's deadline, but come December, members of Congress will need to choose to put country before party and prevent default," said Democratic Representative Richard Neal, chairman of the House Ways and Means committee.

Republicans insist Democrats should take sole responsibility for raising the debt limit because their party wants to spend trillions of dollars to expand social programmes and tackle climate change.

Democrats say the increased borrowing authority is needed largely to cover the cost of tax cuts and spending programmes during former Republican president Donald Trump's administration, which congressional Republicans supported.

Senate Republican Leader Mitch McConnell wrote to Mr Biden last Friday saying that he would not work with Democrats on another debt limit increase. Mr McConnell had been harshly criticised by Mr Trump after the Senate vote.

"I will not be a party to any future effort to mitigate the consequences of Democratic mismanagement," Mr McConnell wrote to Mr Biden, saying another vast spending Bill would hurt Americans and help China.

Lawmakers have only until Dec 3 to pass legislation to fund the government and prevent a shutdown.

House Speaker Nancy Pelosi told reporters on Tuesday she hoped there could be a bipartisan solution to the debt ceiling issue. She said a Democratic proposal to allow the Treasury Department to lift the debt ceiling, with Congress having the ability to overrule it, "has merit".

She repeated that Democrats do not want to use a procedural manoeuvre called "reconciliation" to raise the ceiling.

Reconciliation would let Democrats raise the ceiling with 51 votes rather than the 60 required under the Senate's filibuster rule if Republicans will not cooperate.

The Senate's vote last week to raise the limit - which had been more routine before the current era of fierce partisanship - turned into a brawl.


A version of this article appeared in the print edition of The Straits Times on October 14, 2021, with the headline 'US House votes for short-term debt ceiling fix, averting default'. Subscribe