Debt ceiling is over – bipartisan vote to pass debt ceiling increase

The House on Wednesday overwhelmingly passed legislation negotiated by President Biden and Speaker Kevin McCarthy to suspend the debt ceiling and set federal spending limits, as a broad bipartisan coalition lined up to cast a critical vote to pull the nation back from the brink of economic catastrophe.

The bill would defer the federal debt limit for two years — allowing the government to borrow unlimited sums as necessary to pay its obligations — while imposing two years of spending caps and a string of policy changes that Republicans demanded in exchange for allowing the country to avoid a disastrous default. The 314-to-117 vote came days before the nation was set to exhaust its borrowing limit, and days after a marathon set of talks between White House negotiators and top House Republicans yielded a breakthrough agreement.

With both far-right and hard-left lawmakers in revolt over the deal, it fell to a bipartisan coalition powered by Democrats to push the bill over the finish line, throwing their support behind the compromise in an effort to break the fiscal stalemate that had gripped Washington for weeks. On the final vote, 149 Republicans and 165 Democrats backed the measure, while 71 Republicans and 46 Democrats opposed it.

That was a blow to the Republican speaker, whose hard-fought victory on the measure was dampened by the fact that more Democrats ultimately voted for the bill than members of his own party.

The measure nearly collapsed on its way to the House floor, when hard-right Republicans sought to block its consideration, and in a suspenseful scene, Democrats waited several minutes  for a procedural measure that allowed the plan to move ahead.

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The deal would suspend the $31.4 trillion borrowing limit until January 2025. It would cut federal spending by $1.5 trillion over a decade, according to the Congressional Budget Office, by effectively freezing some funding that had been projected to increase next year and then limiting spending to 1 percent growth in 2025, which is considered a cut because it would be at a lower level than inflation. The legislation would also impose stricter work requirements for food stamps, claw back some funding for I.R.S. enforcement and unspent coronavirus relief money, speed the permitting of new energy projects and officially end Mr. Biden’s student loan repayment freeze.

The compromise was structured with the aim of enticing votes from both parties. It allowed Republicans, who refused to raise the debt ceiling and avert a default without conditions, to say that they succeeded in reducing some federal spending — even as funding for the military and veterans’ programs would continue to grow — while allowing Democrats to say they spared most domestic programs from the severe cuts.

Mr. McCarthy framed the bill on Wednesday as a “small step putting us on the right track” and urged his members to support it.