(Washington) The bitter battle between Democrats and Republicans to avoid a cataclysmic default of payment by the United States moves to Congress on Sunday where it promises to be fierce and with an uncertain outcome.
After marathon negotiations, President Joe Biden and the Republican leader in Congress Kevin McCarthy announced Saturday evening an agreement in principle on the raising of the American debt ceiling making it possible to remove the threat of bankruptcy from June 5.
But the agreement must receive the approval of a divided Congress and is already the subject of a revolt of elected progressives and conservatives, some speaking of a “capitulation”.
“He may not satisfy everyone, but it’s a step in the right direction that no one expected,” Republican leader Kevin McCarthy defended on Fox News on Sunday, welcoming in particular a “historic” reduction in public spending.
PHOTO NATHAN HOWARD, REUTERS
Republican House Leader Kevin McCarthy
He predicted that a “majority” of elected Republicans would vote for the text.
The House of Representatives, where Republicans have a fragile majority of 222 to 213, will vote on Wednesday. Next will come the Senate, narrowly controlled by the Democrats (51-49).
President Biden also welcomed this “compromise” on Saturday evening, which is “good news, because it avoids what would have been a fault [de paiement] catastrophic”.
He was to meet again in the afternoon with the Republican leader to finalize the terms of the agreement, which must also be transposed into a bill, according to a press release on Sunday from the leader of the Democratic minority in the House, Hakeem Jeffries.
Political Credit
The text of the agreement has not yet been disclosed but it raises for two years, so until after the presidential election of 2024, the public debt ceiling of the United States.
It is currently set at $31.4 trillion.
Non-defence spending will remain virtually unchanged next year and will increase only nominally in 2025.
Separately, new rules will apply to access to some federal aid programs, but according to a source familiar with the negotiations the deal protects the Inflation Reduction Act and the debt relief plan student, signed by Mr. Biden.
Each side claims victory.
According to the Democrats, there are not the significant reductions desired by the Republicans, the latter ensuring for their part that spending is capped for the first time in history.
MM. Biden and McCarthy are playing their political credit in these negotiations.
The first, who is a candidate for re-election, must avoid a bankruptcy with potentially catastrophic consequences, while the second seeks to establish his authority after having been poorly elected to the perch at the start of the year.
President Biden had long refused to come to the negotiating table, accusing the opposition of taking the American economy “hostage”, but finally resolved to do so.
Still, an alliance of circumstance between elected progressives within the Democratic Party and elected Conservatives threatens not to ratify the agreement.
Conservative Republicans have already announced their opposition to the text, such as Bob Good or Lauren Boebert. “No elected official claiming to be from the conservative camp could justify a positive vote”, estimated the first, and “our voters deserve better than that, you can count me as a NO to the agreement”, tweeted the second.
A third, Representative Dan Bishop, took the Republican leader to task for having “obtained almost nothing”.
Without raising the debt, the first world power risks being in default of payment on June 5, unable to honor its financial commitments: salaries of civil servants, pensions or reimbursements to its creditors.
Like almost all major economies, the United States lives on credit.
But unlike other developed countries, the United States regularly comes up against a legal constraint: the debt ceiling, the maximum amount of indebtedness of the United States, which must be formally raised by Congress.
This has long been routine legislative procedure. The Republicans have made it an instrument of political pressure.