The White House announced that US President Joe Biden signed into law on June 3 on the public debt ceiling after weeks of controversy, aiming to prevent a catastrophic default.
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| US President Joe Biden. Photo: VNA |
Specifically, President Biden signed into law the "Fiscal Responsibility Act of 2023" suspending the policy of applying the public debt ceiling to extend loans and maintain payment of bills, thereby avoiding a default that could cause panic in the market, widespread job losses and economic recession, with consequences on a global scale.
The House and Senate passed the bill earlier this week after President Biden and House Speaker Kevin McCarthy reached an agreement after intense negotiations. Under the agreement, the two sides agreed to suspend the $31.4 trillion debt ceiling for two years, until January 1, 2025; limit spending in fiscal years 2024 and 2025, with $886 billion allocated to the defense budget in fiscal year 2024 and $704 billion for non-defense items.
Overall non-defense spending remains unchanged in fiscal 2024. The two sides agreed to increase non-defense spending by 1% in fiscal 2025. In addition, the two sides agreed to recover unused Covid-19 funds; speed up the licensing process for some energy projects; and increase eligibility for pro-poor programs.
According to VNA
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