Debt Ceiling Bill Passed Just Hours Before Deadline
Avoiding the first-ever government default, in a 74-26 vote just hours before the midnight deadline, President Obama signed the bipartisan bill which allowed the nations’ $14.3 trillion borrowing cap to rise by $2.4 trillion.
“It’s an important first step to ensuring that as a nation we live within our means,” Obama said in a press conference following the vote. “This is, however, just the first step. This compromise requires that both parties work together on a larger plan to cut the deficit.”
The measure provides an immediate $400 billion increase in the $14.3 trillion U.S. borrowing cap, with $500 billion more assured this fall. That $900 billion will be matched by cuts to agency budgets over the next 10 years starting with $21 billion in the fiscal year starting in October.. The measure also establishes a special bipartisan committee of six Republicans and six Democrats charged with closing the deficit up to $1.5 trillion more in additional cuts no later than Nov. 23. If they cannot reach a consensus or Congress fails to act on the recommendations by Dec. 23, there will be automatic cuts across the budget, which include cuts in defense and entitlement programs.
“Since you can’t close the deficit with just spending cuts, we’ll need a balanced approach where everything’s on the table,” Obama said. “Yes, that means making some adjustments to protect healthcare programs like Medicare so they’re there for future generations. It also means reforming our tax code so that the wealthiest Americans and biggest corporations pay their fair share.” It also means eliminating taxpayer subsidies and closing tax loopholes, he said. “I’ve said it before, I will say it again: We can’t balance the budget on the backs of the very people who have borne the biggest brunt of this recession,” Obama said. “Everyone’s going to have to chip in. That’s only fair. That’s the principle I’ll be fighting for during the next phase of this process.”
Although some may not agree with some of the conditions of this bipartisan bill the signing of it ultimately spared the country from an embarrassing default. The president praised lawmakers for finally passing the compromise bill, and demanded that they take immediate steps to boost job creation when they return from their summer break.