Bill Passes With Funding Recovered, IRS Expanded but Few Republican Demands Met

Before a vote in Congress is anticipated as soon as this coming Wednesday, the wording of a contentious deal to extend the US debt ceiling was made available to the public on Sunday. Treasury Secretary Janet Yellen has issued a warning that if the debt ceiling is not lifted, the US might begin to default on its debts as early as June 5. 

The 99-page "Fiscal Responsibility Act of 2023" lifts the debt ceiling for two years while establishing discretionary expenditure caps through the year 2029. It establishes a generous cap of $886 billion for the 2024 defence budget and $895 billion for 2025, while giving just $637 billion to non-military discretionary expenditures. 

Except for the controversial expansion of the Internal Revenue Service under the Inflation Reduction Act and the recovery of $28 billion in unapplied Covid-19 funding, the bill contains relatively few of the spending cuts Republicans had demanded. 

The earliest the measure will be brought to the House floor is on Wednesday, but approval is not assured since members of both parties may object to certain provisions of the agreement. Members of Congress must consider the law for at least 72 hours before voting.

Rep. Chip Roy (R-Texas) summed up the sentiments of Republicans who think raising the debt ceiling by $4 trillion without major cutbacks is extremely economically reckless by calling the arrangement a "turd sandwich" on Sunday. 

Rep. Pramila Jayapal (D-Washington), who is in charge of the Congressional Progressive Caucus, said on CNN that party officials "have to worry" about whether the group will back the plan, which increases work requirements for some beneficiaries of food stamps but exempts Medicare users. 

On Saturday, President Joe Biden and House Speaker Kevin McCarthy reached an understanding on the deal's fundamentals, both of them hailing the agreement as a triumph for their own party. 

The United States would experience its first-ever default if Congress doesn't lift its borrowing cap in time. Many worry that this would trigger a worldwide catastrophe since the dollar serves as the world's reserve currency and because the debt is so enormous ($31.8 trillion).

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