On Saturday, Kevin McCarthy, the Senate’s top Republican leader, and President Joe Biden announced a compromise to raise the national debt ceiling, narrowly averting an economic crisis and default. Congress will vote on Wednesday on the proposed legislation to extend the government’s borrowing power; this comes mere days before the June 5 deadline – known as the “X-date” – when the Treasury predicts that the US will run out of money and plunge into turmoil. McCarthy, the speaker of the House of Representatives which is controlled by the Republican Party, said in a statement, “After weeks of negotiations we have come to an agreement in principle.”

After informing Biden of their successful negotiations on Saturday, McCarthy planned to consult with the president again on Sunday and ensure the bill was compliant with its intended goals. On Wednesday, the House of Representatives will be voting on the proposed bill which Biden believes would prevent a “catastrophic default” and have dire consequences on the economy, retirement accounts, and employment. Although an agreement was reached, McCarthy urged that “a lot of work” still had to be done to win over support from Congress.

Secretary Yellen Sends Debt Limit Letter to Congress (5/26/23)

 

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