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Politico | Congress punts US debt limit crisis into December

  • US House vote raises debt ceiling, averting a default for less than two months
  • First-ever debt default could spark a recession and roil world markets

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The new level of borrowing authority is expected to be exhausted around December 3, requiring Congress to act again before then. Photo: AFP
POLITICO

This story is published in a content partnership with POLITICO. It was originally reported by Caitlin Emma and Jennifer Scholtes on politico.com on October 12, 2021.

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The Democratic-controlled House of Representatives approved a bill on Tuesday to briefly alleviate the squeeze of the US debt limit, warding off an economically destructive default for just over seven weeks.

President Joe Biden is expected to sign the legislation in short order, allowing the Treasury Department to keep paying loans for the nation’s more than US$28 trillion in debt. The extra borrowing power is estimated to last until about December 3, the same day government funding will expire. That patch is far shorter than the 14-month fix Democrats had to abandon after Senate Republicans repeatedly sunk the majority party’s long-range plan for lifting the cap on the nation’s credit.

“Nobody has clean hands when it comes to the debt limit,” House Majority Leader Steny Hoyer said before the vote, after months of partisan sniping over who’s responsible for racking up the government’s bills.

“This is our debt. This is America’s debt,” said Hoyer, a Democrat. “Some of it relates to greater spending promoted by both sides of the aisle. But for any one of us to get up and say, ‘It’s your debt’ , – it’s America’s debt and America pays its bills.”

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At the same time, Hoyer panned the two-month patch as an “irresponsible and despicable act for adults who know better”.

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