US Prez Biden & speaker McCarthy reach budget agreement in principle

29 May '23

2 min read

US President Joe Biden. Pic: @POTUS/Twitter

Insights

US President Joe Biden and Kevin McCarthy have reached a consensus to raise the US debt ceiling, preventing a potential default.
Biden has urged Congress to approve the agreement swiftly, saying it balances reduced spending with protecting crucial programmes and supporting economic growth.
This move will protect the economy from a potential recession.

American President Joe Biden and house speaker Kevin McCarthy have declared their mutual agreement, in principle, to increase the US debt ceiling, thus avoiding a potential default. The agreement now moves to Congress for approval, which needs to pass it before the government begins to run out of money.

“The agreement represents a compromise, which means not everyone gets what they want,” President Biden said in statement. “It is an important step forward that reduces spending while protecting critical programmes for working people and growing the economy for everyone. And, the agreement protects my and Congressional Democrats’ key priorities and legislative accomplishments.”

The agreement has now gone to the United States House and Senate. President Biden has strongly urged both chambers to pass the agreement right away.

He added that this agreement is good news for the American people, because it prevents what could have been a catastrophic default and would have led to an economic recession, retirement accounts devastated, and millions of jobs lost.

The US department of treasury will have insufficient resources to satisfy the government’s obligations if Congress does not raise or suspend the debt limit by June 5, US secretary of the treasury Janet L Yellen said in her latest letter to congressional leadership on the debt limit.

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