2023-05-28 16:12:07
UNITED STATES
Tough battle over debt moves to US Congress
To avoid a payment default, the agreement in principle obtained on Saturday evening by Joe Biden and Kevin McCarthy will have to overcome a sling of elected progressives and conservatives.
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The House of Representatives, where the Republicans have a fragile majority of 222 against 213, will vote on Wednesday, before the Senate.
The bitter battle between Democrats and Republicans to avoid a cataclysmic default of payment by the United States moves to Congress on Sunday, where it promises to be fierce and with an uncertain outcome.
«Capitulation»
After marathon negotiationsPresident Joe Biden and Republican Congressman Kevin McCarthy announced on Saturday evening agreement in principle on the raising of the American debt ceiling making it possible to remove the threat of bankruptcy as of June 5. But the agreement must receive the approval of a divided Congress and is already the subject of a revolt of elected progressives and conservatives, some speaking of a “capitulation”.
“He may not satisfy everyone, but it’s a step in the right direction that no one expected,” Republican leader Kevin McCarthy defended on Fox News on Sunday, welcoming in particular a “historic” reduction in public spending. He predicted that a “majority” of elected Republicans would vote for the text. The House of Representatives, where Republicans have a fragile majority of 222 to 213, will vote on Wednesday. Next will come the Senate, narrowly controlled by the Democrats (51-49).
Why US debt is problematic
“Compromise”
President Biden also welcomed this “compromise” on Saturday evening, which is “good news, because it avoids what would have been a catastrophic (payment) default“. He was to meet again in the afternoon with the Republican leader to finalize the terms of the agreement, which must also be transposed into a bill, according to a press release on Sunday from the leader of the Democratic minority in the House, Hakeem Jeffries.
The text of the agreement has not yet been disclosed but it raises for two years, so until after the presidential election of 2024, the public debt ceiling of the United States. It is currently set at $31.4 trillion. Non-defence spending will remain virtually unchanged next year and will only increase nominally in 2025. Separately, new rules will apply to access to some federal aid programs, but according to a source familiar with the Negotiations The deal protects the Cut Inflation Act and Student Debt Relief Plan, signed by Joe Biden.
Opposition announced
Each side claims victory. According to the Democrats, there are not the significant reductions desired by the Republicans, the latter ensuring for their part that spending is capped for the first time in history. President Biden had long refused to come to the negotiating table, accusing the opposition of taking the American economy “hostage”, but finally resolved to do so.
Still, an alliance of circumstance between elected progressives within the Democratic Party and elected Conservatives threatens not to ratify the agreement. Conservative Republicans have already announced their opposition to the text, such as Bob Good or Lauren Boebert. “No elected official claiming to be from the conservative camp could justify a positive vote”, estimated the first, and “our voters deserve better than that, you can count me as a NO to the agreement”, tweeted the second. A third, Rep. Dan Bishop, took the Republican leader to task for getting “almost nothing.”
Without raising the debt, the first world power risks being in default of payment on June 5, unable to honor its financial commitments: salaries of civil servants, pensions or reimbursements to its creditors.
(AFP)
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