The House of Representatives approved legislation to boost the U.S. debt ceiling. The bill, approved by the Senate last week, now goes to President Joe Biden’s desk for his signature and enactment. He’s expected to sign it later in the week.  

The Senate approved last week to raise the Treasury Department’s borrowing limit until sometime around the beginning of December 2021. They voted on offering another $480 Billion in borrowing to the Treasury. The US defaulting on its debt is unthinkable. Default could cause an enormous financial crisis round the world. The world’s best interest that America don’t default. The legislation, which cleared the House with a party-line vote of 219-206, would extend the debt limit by $480 billion.

The current debt is $28.4 trillion and would be permitted to rise to about $28.8 trillion.

While the president is expected to sign the bill, failure to try to to so would end in economic calamity by Oct. 18. Congress knows this. They’ve raised the debt limit zillion times. Standard & Poor’s actually downgraded the US’s credit rating from AAA to AA+ in 2011, when the debt limit battle was quite fierce.

Not sure that legislators want to deal with this debt ceiling issue again and again, especially in such uncertain times amidst a hyper-polarized government and political environment.

One other thing: many of the same legislators involved in 2011’s debt ceiling negotiations are presiding over this one as well: Pelosi, Biden, Hoyer, and McConnell all did this 10 years ago. Time will tell. Till then enjoy the S&P ride.

Spread the love