US averts default as Senate narrowly passes debt ceiling bill
What's the story
The US Senate on Thursday narrowly approved a bill to suspend the country's borrowing limit days before it was due to default on its debt.
The final vote for the bill was 63 to 36, with 44 Democrats and 17 Republicans in favor of the bill against five Democrats and 31 Republicans.
The number of votes required to pass the bill was 60.
Context
Why does this story matter?
The world's largest economy was staring at a default on its $31.4 trillion debt—forecast to overshoot the ceiling on Monday—which would've limited its borrowing limit or pay all of its bills.
A default could have wreaked havoc not only on the US but on the global economy. Before the Senate, the US House of Representatives approved the bill with a vote of 314-117.
Statement
Critical step forward, says Biden
Soon after the passage, President Joe Biden said, "Tonight, senators from both parties voted to protect the hard-earned economic progress we have made and prevent a first-ever default."
The Senate majority leader from the ruling Democratic Party, Chuck Schumer said, "Tonight's vote is a good outcome because Democrats did a very good job taking the worst parts of the Republican plan off the table."
Senators
Bernie Sanders, Elizabeth Warren, John Fetterman voted against the bill
The bill was negotiated between Biden and the speaker of the House of Representatives, Kevin McCarthy, a Republican. It will suspend the government's borrowing limit until January 2025, a couple of months after the presidential elections.
The Democrats who voted against the bill in the Senate included Bernie Sanders, John Fetterman, and Elizabeth Warren. The Senate rejected 11 proposed amendments to the bill.
Details
Legislation expected to save $1.5 trillion over decade
Notably, Republicans control the House while Democrats hold sway in the Senate and the White House. The debt ceiling deal remained elusive for weeks until Biden and McCarthy reached a compromise.
The legislation will save $1.5 trillion over a decade, as per the independent Congressional Budget Office. The last time the US reached the brink of overshooting its debt ceiling was in 2011.