Business & Economy

US avoids debt default, but only until December

Washington, Oct 12 (EFE).- With the final approval of a congressional initiative, the United States avoided incurring Tuesday a default on the national debt as of Oct. 18, when it was going to run out of funds, but it will have to discuss this issue again before December.

The subject of indebtedness had become a thriller in Washington in recent weeks, where disagreements between Democrats and Republicans had brought the country to the brink of default for the first time in its history.

The House of Representatives, with a Democratic majority, approved a bill that raises the debt ceiling of $ 480 billion, which will allow the country to pay its debts until Dec. 3.

The initiative was approved with 219 votes in favor and 206 against, and will now be sent to the White House for US President Joe Biden to sign and become law.

Before the proposal received the green light, House Speaker Democrat Nancy Pelosi said Senate Republicans Leader Mitch McConnell had played “Russian roulette” with the American economy for weeks.

“What do you have against our own economy?” Pelosi said. “This catastrophe against our workers could have an impact of more than 100 years. Do they not care? And the world economy laying off its employees?”

Pelosi painted a grim picture of what might have happened had congress not acted.

The US has never had to suspend payments on its national debt, but it was very close in 2011, when the mere possibility of that happening unleashed chaos in the financial markets.

The possibility of the US plunging into a recession ended up taking its toll on McConnell, who gave in last week.

McConnell decided to forwent a parliamentary rule requiring a supermajority to pass laws, allowing Democrats to pass the move in the Senate unilaterally. EFE


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