President Biden signed the the “Fiscal Responsibility Act” into law on Saturday, suspending the debt ceiling until 2025 and “avert[ing] an economic crisis.”
“No one got everything they wanted but the American people got what they needed,” Biden said in his first-ever Oval Office address to the nation Friday night. “We averted an economic crisis and an economic collapse.”
The deal had been negotiated and agreed to last Saturday by Biden and House Speaker Kevin McCarthy (R-CA). It suspends the debt ceiling beyond next year’s presidential election into 2025. It also caps spending in the 2024 and 2025 budgets, claws back unused Covid pandemic funds, speeds up the permitting process for some energy projects, and include extra work requirements for aid programs like food stamps, though overall funding is mostly held flat for domestic programs.
The Senate voted 63-36 late Thursday to give final approval on the deal late Thursday night, mostly along party lines, though five Democrats and a Democratic-leaning Independent voted against the bill, along with 31 Republicans.
The vote in the upper chamber came a day after the House voted 314 to 117 for its passage, with support for the deal coming from 16 more Democrats than Republicans in the lower chamber.
“I know bipartisanship is hard,” Biden said Friday night. “And unity is hard. But we can never stop trying.”
In a press release announcing the bill’s signing, Biden thanked Congressional leaders Senate Majority Leader Chuck Schumer (D-NY), Senate Minority Leader Mitch McConnell (R-KY), and House Minority Leader Hakeem Jeffries (D-NY) along with Speaker McCarthy.
He also thanked Reps. Pete Stauber (R-MN) and Mark DeSaulnier (D-CA) along with Sens. Amy Klobuchar (D-MN) and Shelly Moore Capito (R-WV) “for their leadership.”
Treasury Secretary Janet Yellen had warned that without lifting the debt ceiling, the government will completely run out of money and default on its financial obligations on Monday.
Wall Street analysts have further warned that a stock market plunge as a result of debt default could have wiped out 6 million jobs and $15 trillion in wealth.