WASHINGTON – The Senate passed legislation Tuesday to raise the nation’s debt limit by $2.5 trillion, one of the final steps Congress needs to take to stave off default and the economic peril that would come if the U.S. were unable to pay its bills.
The bill, approved in a 50-49 vote, now heads to the House of Representatives for final passage before it can head to President Joe Biden’s desk for a signature.
Senate Majority Leader Chuck Schumer, D-N.Y., said Tuesday the increase is enough to last into 2023, which would allow Congress to avoid any more fights over the debt ceiling until after the 2022 midterm elections.
Treasury Secretary Janet Yellen told lawmakers she estimated the United States would reach its debt ceiling by Wednesday.
If lawmakers do not address the debt limit by then, the U.S. would default on its debts for the first time, which could lead to a global recession, Treasury Department officials and experts said.
The legislation was made possible by an agreement between Senate and House leaders to establish a one-time fast-track process to pass the measure in the Senate without threat of GOP interference or other procedural hurdles.
The ability to pass it through a simple majority in the Senate— 51 votes instead of the 60 that is usually needed to bypass the filibuster — did just that.
Senate Republicans had been reluctant to help Democrats raise the debt ceiling, and have blocked a long-term increases to the debt limit, leading to the short-term agreement.
Lawmakers had been struggling to reach a consensus on the debt ceiling for months, as Democrats have insisted the debt that has accumulated is a bipartisan burden.
Republicans wanted Democrats to specify an exact dollar number they’d raise the limit by, as conservatives criticize Democrats over cost of their legislative agenda, most notably Biden’s Build Back Better Act of social spending programs.
The legislation does just that by raising it $2.5 trillion, instead of suspending it for a length of time.