Senate to Pass Bill to Raise Debt Ceiling and Cap Government Spending

Senate to Pass Bill to Raise Debt Ceiling and Cap Government Spending

The Senate has begun the debate on proposed amendments to a House-approved bill to raise the debt ceiling and cap government spending. Majority Leader Chuck Schumer has said that the chamber would pass the bill on Thursday night. The votes on 11 amendments began at around 7:30 p.m. ET, and were expected to take several hours.

Deadline for Raising or Suspending Debt Ceiling

Driving the pace Thursday was the looming June 5 deadline for raising or suspending the debt ceiling, just four days away. Treasury Secretary Janet Yellen said the government would most likely be unable to meet its debt obligations next week unless Congress voted to raise the debt limit.

Under normal rules, it would take the Senate about a week to move a simple bill to the floor and vote on it. In order to bypass those rules and vote on the bill in time to meet the Monday deadline, Schumer needed the unanimous consent of every senator.

Concerns and Amendments

For much of the day on Thursday, that consent proved elusive, owing largely to a group of Senate Republicans who demanded that Schumer agree to back a supplemental defense funding bill and funding for Ukraine before they would consent to fast-tracking the debt ceiling vote.

The senators were chiefly concerned that the bill passed by the House Wednesday night, the Fiscal Responsibility Act, did not adequately fund the military, and that spending caps mandated by the bill could cut into the Pentagon’s budget.

Republican Sen. Susan Collins of Maine called that figure “woefully inadequate” in a speech on the Senate floor, arguing that a 1% increase did not keep pace with inflation, so in practical terms, it was actually a decrease in military funding.

Virginia Democratic Sen. Tim Kaine introduced an amendment that would remove a provision in the House bill that effectively greenlights a controversial natural gas project, the Mountain Valley Pipeline through West Virginia and Virginia. Utah Republican Sen. Mike Lee proposed an amendment to remove a line in the House bill that would allow the director of the Office of Management and Budget to unilaterally waive some spending restrictions on federal regulators if they determined that the spending was needed for “effective program delivery.”

Schumer made it clear all week that he would not let the debt ceiling bill be amended, essentially moving it back to the starting gate in the House. But for the senators who proposed the amendments, getting a vote on the Senate floor was enough, ensuring that their objections were heard and their colleagues were forced to go on the record with a vote.

Passing of Bill and Its Implications

Once the proposed amendments were completed, Schumer said the Senate would proceed immediately to a vote on the debt ceiling, which was expected to pass in time to avert a potentially disastrous U.S. debt default. “America can breathe a sigh of relief because in this process, we are avoiding default,” Schumer said. “Let’s finish the job and send this very important bipartisan bill to the President’s desk tonight.”

If the Treasury were to fail to meet its obligations, economists agree that it would likely send global markets into shock, trigger job losses in the U.S. and jeopardize the delivery of vital government benefits that tens of millions of Americans rely on to survive.

The Fiscal Responsibility Act was the result of a deal reached between House Speaker Kevin McCarthy and Biden, which essentially handed conservatives several ideological policy victories in exchange for their votes to raise the debt ceiling beyond next year’s presidential election and into 2025. The bill passed in the House 314-117, with support from more Democrats than Republicans.

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