United States: The Room Opens Its Roof (On Debt)

Bipartisan agreement

This time, too, the United States should Avoid default. felt since then The debt ceiling will be reached in a few days. Agreement reached Posted by Joe Biden and Republican Speaker Kevin McCarthywhich suspends the maximum debt until the beginning of 2025, was vote in the House of RepresentativesMe: 314 in favor (65 Democrat, 149 Republican), 117 against.

The word now moves to the Senate, which is expected to approve the measure in the next few days. time is running out. According to estimates, By June 5th, the federal government will be out of money: If the law is not ready for Biden to sign by then, Washington will not have the funds available to pay salaries and public services.

The date of the declared debt

But what is the red color of the United States? today Total federal government debt is about $31.4 trillion. A huge number exploded after the pandemic, which is now according to the International Monetary Fund exceeded the gross domestic product: Today the ratio between the two is about 115%.

With the ceiling suspended, a new season of debt growth is expected for the United States. According to the Congressional Budget Office, By 2032 it could rise to 40.2trillion, even if it remains at 110% of GDP. But some pessimistic forecasts reach a debt estimate of at least 50.3 trillion by the same year.

whose victory?

McCarthy, who leads the Republican majority in the House of Representatives, presented the agreement as “a small step that puts us on the right track.” On the other hand, the Republicans succeeded in this Get some cuts and restrictions on public spending (except for the military budget). Measures dear to the party, but perhaps not brave enough for the more radical wing, which in fact refused to support the motion.

Ironically, despite a Republican majority in the House of Representatives, the supporting voters were largely Democrats. And so McCarthy was able to rally a centrist group to defeat the party comrades on his right (71 Republicans voted against). But in light of the primaries, the agreement remains hotly debated, with Donald Trump which he stated he would prefer to leave default country. While the rest of the world, worried, could only stand by and watch.

Earl Warner

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