Once the Democrats control the short-term extension, it will be scrapped for President Joe Biden’s signature.
But the temporary credit limit extension is only a short-term fix, and creates another financial crisis when it ends later this year.
After weeks of indiscriminate stalemate over the issue, Senate Majority Leader Chuck Schumer announced last week that a credit limit agreement had been reached, paving the way for the Senate to vote on the deal. An aide familiar with the talks told CNN that the deal raises the ceiling to $ 480 billion, which the Treasury Department told Congress to get by December 3.
The announcement of the deal comes a day after Senate Minority Leader Mitch McConnell proposed a debt ceiling for the Democrats, which sparked talks between the two parties to reach an agreement.
House Majority Leader Steny Hoyer issued a statement following the Senate passage of the Stop Cape Bill.
Why the crisis still lingers
The problem is that the dispute between the two sides over how to resolve the issue has not been resolved and action will be needed in a few weeks to avoid a recurrence of the crisis.
Republicans have been urging Democrats to act alone to address the debt limit through a process called budget reconciliation. Democrats argued that the issue was bilateral. They have so far largely ruled out the possibility of using reconciliation, arguing that the process is too lengthy and involuntary and the risk of miscalculation is too high.
“I will not be a party to any future attempt to mitigate the consequences of democratic mismanagement. They told your lieutenants in Capitol Hill that they had no way of resolving the debt ceiling through a separate compromise. They could not find another crisis and ask for my help,” McConnell wrote.
CNN’s Christine Wilson, Annie Grayer and Matt Egan contributed.
“Communicator. Music aficionado. Certified bacon trailblazer. Travel advocate. Subtly charming social media fanatic.”