US Federal Government Avoids Default... House Also Passes Debt Ceiling Increase

Nancy Pelosi, Speaker of the U.S. House of Representatives [Photo by EPA Yonhap News]

[Asia Economy Reporter Byunghee Park] The U.S. Congress has dramatically passed a bill to raise the federal government's debt ceiling, averting a default crisis for the U.S. federal government.

According to the Associated Press, the U.S. House of Representatives passed the bill to raise the federal government's debt ceiling early on the 15th (local time) with 221 votes in favor and 209 against.

The Senate had passed the bill the previous afternoon, and within just a few hours, the House swiftly approved it. The Senate vote was 50 in favor and 49 against. This bill raises the federal government's debt ceiling from the existing $28.9 trillion to $31.4 trillion and now only awaits President Joe Biden's signature.

Last month, Treasury Secretary Janet Yellen warned that if the federal government's debt ceiling was not raised, the debt limit would be reached on the 15th.

The U.S. federal government, which has been steadily increasing its fiscal deficit, has avoided default crises by either raising the debt ceiling or suspending its application.

During former President Donald Trump's administration in July 2019, the debt ceiling application was suspended for two years. That suspension expired on July 31 of this year, bringing the risk of federal government default to the forefront. In October, Congress raised the federal government's debt ceiling by $480 billion, and this time it increased it by another $2.5 trillion. Since this increase is larger than the one in October, the U.S. federal government will be able to eliminate the risk of default for some time.

The Associated Press reported that the debt ceiling issue has been resolved at least until after next year's midterm elections.

This content was produced with the assistance of AI translation services.