Bill to Increase Debt Ceiling Passed in the U.S. Senate

After surviving a Republican uprising in the House of Representatives, the Senate approved a bipartisan agreement between United States President Joe Biden and House Speaker Kevin McCarthy to raise the $31.4 trillion U.S. debt ceiling.

On June 1, the Senate approved a compromise plan with specific cuts and spending restrictions on healthcare for the following two years. However, the agreement protects health programs like Medicaid from the significant reductions the Republican-led House approved in April.

The federal government's borrowing cap is postponed by the bill until January 1, 2025, following the subsequent presidential election. House Republicans persuaded Democrats to make budget cuts due to the pressing necessity for Congress to take action to prevent an unprecedented debt default and its adverse economic effects.


Nonetheless, the compromise agreement, negotiated mainly by House Speaker Kevin McCarthy and representatives of the Biden administration, only significantly restricts health spending. Republicans who lean farther to the right expressed their displeasure at what they viewed as a giveaway to Democrats.

"It is a bad deal," says Representative Chip Roy. "No one sent us here to borrow an additional $4 trillion to get absolutely nothing in return."

The most significant health-related concession made by Democrats, aside from the spending caps, is the clawback of nearly $27 billion in funds approved for programs related to chronic disease which have not yet been expended.

For example, money is being returned to the federal government from programs focused on housing and transportation. Still, only a percentage of the funds regained from COVID-19 programs are health-related. According to the Congressional Budget Office, the Public Health and Social Services Emergency Fund has had the most significant rescission of the unspent COVID money at nearly $10 billion.

The CDC would be required to return $1.5 billion. However, priority initiatives, including funding for research into next-generation COVID-19 vaccines, extended COVID-19 research, and attempts to enhance the pharmaceutical supply chain, are excluded from such health-related givebacks.

The federal deficit would have been lowered by around $5 trillion during that law, including more than $3 trillion in domestic discretionary program cuts, which make up roughly 15% of total spending. The NIH, CDC, and the FDA are just a few health organizations that receive a portion of the 15%.

There are no additional Medicaid work requirements under the agreement. The law also maintains existing levels of other health spending for the upcoming fiscal year and permits a 1% rise the following year. Later, the House and Senate Appropriations Committees will decide the precise allocation of the monies among the discretionary programs under their control.

According to advocacy organizations, even a financial freeze harms programs that give millions of Americans essential services. Conservatives who had anticipated the debt ceiling battle would allow them to reduce federal spending significantly are less than delighted, though.


"Overall, this agreement would continue America's trajectory towards economic destruction and expanded federal control," says the President of the Conservative Heritage Foundation, Kevin Roberts.

He concludes: "House Republicans must go back to the negotiating table and demand more concessions from the Biden administration. Heritage stands with the everyday American and behind every member of Congress who is willing to fight for fundamental fiscal change in Washington."


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