This week, the US Congress approved a law that allows raising the public debt ceiling for the United States and allows Washington to pay its payments until the beginning of 2025, in addition to setting a number of goals in the budget.
Biden thanked members of Congress, including Republican leader Kevin McCarthy, for their “cooperation” in this file, according to a White House statement Saturday.
The adoption of the law in the Senate on Thursday, where the majority of members are Democrats, and in the House of Representatives on Wednesday, where the majority of members are Republicans, allowed the United States to avoid defaulting on its dues, as of Monday, June 5.
“We avoided an economic crisis and economic collapse,” Biden said in a televised address to the nation from the Oval Office on Friday, restoring the tone of unity and calm with which he opened his presidential term.
“Nothing would be more irresponsible and nothing would be more catastrophic,” he said, than the default that threatened the United States from June 5.
“It’s hard to find a compromise that crosses partisan lines,” Biden asserted. “Unity is hard, but we must never stop trying.”
Shared victory
The financial showdown between Democrats and Republicans had broadly political goals.
The 80-year-old Biden, who is running for re-election in 2024, realizes that his advanced age threatens his chances.
Biden hopes that reaching an agreement to raise the debt ceiling, after arousing concern in the political and media spheres in the United States, will enhance his image as a seasoned and wise leader.
On Friday, the US President was keen to pay a “greeting” to his most prominent opponent on the issue of religion, the Republican Speaker of the House of Representatives, Kevin McCarthy.
“The two sides negotiated in good faith. Both sides kept their word,” he said.
Although the president intended to take advantage of the opportunity to increase his political balance, he avoided an explicit declaration of victory after negotiations with the opposition over the budget.
“Nobody got everything they wanted, but the Americans got what they needed,” he said.
McCarthy sought to consolidate his power over a diverse parliamentary group, between moderate conservatives and staunch supporters of former President Donald Trump.
The Republican billionaire, who is also running for the presidential elections scheduled for 2024, called for maintaining a tough stance in negotiations with the White House.
In the end, the two sides declared victory, as the Republicans praised their ability to freeze some expenses, while the Democrats praised the preservation of social benefits and major investments.
Carry on through debt
There is no indication that this political battle over public finances will actually affect the electorate in 2024.
This political impasse is not the first, as doubts about the possibility of raising the debt ceiling had prevailed during the era of President Barack Obama.
However, what is certain is that the political confrontation had an impact, as Fitch Ratings kept the US rating agency AAAA on Friday under scrutiny. Fitch denounced the “political polarization”, noting “a continuous deterioration in governance over the last 15 years”.
The United States, like almost all other developed economic powers, relies on debt and it records the highest debt in the world, but it is the only industrial power that regularly collides with a debt ceiling that Congress must raise every time after an arduous negotiation process.
#Biden #signs #law #country #avoid #defaulting #debt