US President Joe Biden signed a law that suspends the national debt limit until January 1, 2025, and increases it from January 2, “to fulfill obligations issued during the suspension period,” the White House press service reports.
The document also sets new limits on discretionary spending, eliminates “certain non-mandatory balances” and ends the suspension of payments on federal student loans.
Recall, earlier it was reported that the share of US defense spending as a result of a compromise on the issue of public debt could be reduced below 3% of GDP for the first time since the end of the Cold War in the 1990s.
The US Treasury warned of a default on June 5 if Congress and the White House did not agree on a compromise. Biden and the Democrats called on Congress to raise the ceiling without any strings attached. The Republicans, who control the House of Representatives, refused to approve an increase without cutting budget spending.
On May 29, Biden and Speaker of the House Kevin McCarthy were able to reach an agreement, defining a number of conditions for a compromise. So, in addition to suspending the limit, the agreement will limit spending for 2024 and 2025, return funds not used to combat the coronavirus pandemic, and speed up the process of issuing permits for some energy projects. The White House assured that the agreement on the national debt will not affect assistance to Ukraine.
Source: Rosbalt
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