A last-minute deal aimed at averting the first-ever US default was approved by the Senate late on Thursday.
The bipartisan bill to raise the country’s debt limit was passed by 63 votes to 36, one day after clearing the US House of Representatives. The legislation has been referred to President Joe Biden, who said he would immediately sign the measure into law.
The new measure is set to avert economic catastrophe, with only days remaining before the US was due to default on its $31.4 trillion debt on June 5.
A default could potentially limit Washington’s options to borrow more or pay its bills. It could also trigger financial havoc overseas, having a massive negative impact on prices and mortgage rates in other countries.
The bill gained support from 44 Democrats and 17 Republicans, plus two independents. Thirty-one Republicans were opposed, including a member of the party’s leadership in the chamber, John Barrasso. Formal approval of the measure required 60 votes in the 100-seat chamber.
Republicans and Democrats had been struggling to reach an agreement on raising the debt ceiling for weeks. The extensive debates over spending priorities put the approval at risk amid increased fears that Republicans, who hold a majority in the House, would fail to support the Fiscal Responsibility Act due to opposition within their own ranks.
Some Republicans had previously dismissed the threat of the US defaulting on its debt as “a scare tactic” employed by Biden and the Democrats to ram through their spending policies.
Former US President Donald Trump, who plans to contest the 2024 election, criticized the bill as well. Earlier this week, he told a radio station in Des Moines that he “would’ve taken the default” if he could not secure a desirable deal.