US averts debt disaster – for now – as Senate approves stopgap fix

Democrats and Republicans agree to extend the US government’s borrowing authority into December

It temporarily averts an unprecedented federal default that experts say would devastate the economy

Reading Time:3 minutes

The Capitol in Washington during morning rush hour. A shutdown could still happen from December 3 when the government’s coffers theoretically run out. Photo: TNS

Published: 2:42am, 8 Oct 2021Updated: 10:16pm, 8 Oct 2021

The US Senate approved legislation to temporarily raise the federal government’s US$28.4 trillion debt limit and avoid the risk of a historic default this month, but put off until early December a decision on a longer-lasting remedy.

The Senate voted 50-48 on Thursday to pass the bill following weeks of partisan fighting. Earlier, 11 Republicans voted in favour of a procedural vote allowing the bill to proceed.

The Senate-passed bill now goes to the House of Representatives, which needs to approve it before President Joe Biden can sign it into law. The House will hold a vote on the bill on Tuesday, according to the office of the No 2 House Democrat, Steny Hoyer.

“President Biden looks forward to signing this bill as soon as it passes the House and reaches his desk,” White House press secretary Jen Psaki said.

“As we approach the coming months, we hope that even more Republicans will join Democrats in responsibly addressing the debt limit instead of choosing default or obstruction.”

President Joe Biden crosses his fingers as he responds to a question about the short term debt deal on Thursday. Photo: AP

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