BREAKING NEWS - House passes bill that includes debt ceiling deal to lift limit before December 15 deadline with only Senate Democratic votes
The House of Representatives passed a bill Tuesday night that contains a provision that will allow the Senate to pass a debt ceiling hike with only Democratic votes.
In a vote of 222 to 212, the House passed a bill that delays Medicare sequestration cuts for three months, which had rules to increase the debt ceiling tucked inside.
Only one Republican, retiring GOP Rep. Adam Kinzinger, voted alongside the Democratic majority.
Earlier Tuesday, Senate leaders struck a deal to create a one-time law allowing Democrats to lift the nation's debt ceiling and avert a catastrophic credit default without requiring votes from Republicans.
The rule will allow lawmakers to avert the crisis with a simple 51-vote majority in the upper chamber before the estimated December 15 deadline.
Crucially, Mitch McConnell, the leader of the Republicans in the Senate, is backing the process.
'I think this is in the best interest of the country, by avoiding default,' he told reporters when questioned about the convoluted approach.
Still, Republicans on the House floor slammed the move.
Republican Rep. Kevin Brady, the ranking member of the House Ways and Means Committee, said Democrats held the Medicare bill 'hostage,' also releasing a statement calling the debt ceiling a 'poison pill.'
'You wrecked a bipartisan agreement for your debt ceiling crisis,' Brady said.
Senate Majority Leader Chuck Schumer repeated a warning about what could happen if lawmakers went over the financial cliff.
'Nobody wants to see the US default on its debts. As Secretary Yellen has warned, a default could eviscerate everything we've done to recover from the COVID crisis,' Schumer said on the floor Tuesday.
'We don't want to see that, I don't believe we will see that, and I continue to thank all my colleagues for cooperating in good faith to preserve the full faith and credit of the United States.'
The U.S. spends more money than it collects through taxation so it borrows money via the issuing of government bonds, seen as among the world's most reliable investments.
Around 80 years ago lawmakers introduced a limit on how much federal debt could be accrued.
The ceiling has been lifted dozens of times to allow the government to meet its spending commitments - usually without drama and with the support of both parties - and stands at around $29 trillion.
The Bipartisan Policy Center said last week it expected the United States would no longer be able to meet its debt repayment obligations between December 21 and January 28.
Treasury Secretary Janet Yellen has put deadline even earlier, saying it would happen on December 15.
Yellen and other Democratic leaders have spent weeks underlining the havoc that a default would have wrought, including the loss of an estimated six million jobs and $15 trillion in household wealth, as well as increased costs for mortgages and other borrowing.
But Republicans in both chambers of Congress were initially objecting to helping raise the limit this time around, saying they refused to support President Joe Biden's 'reckless' taxing and spending plans.
In reality, both parties see raising the borrowing cap as politically toxic, and Republicans hope to weaponize the issue in the 2022 midterm election campaign.
Under the complex, multi-step compromise proposed Tuesday, the Republicans can essentially stand on the sidelines, offering help to create the new law but offering no votes to increase the limit.
They'll do that in the Senate by joining Democrats in a procedural vote - to ensure there are 60 votes to override a GOP filibuster - then only Democrats are expected to vote on the final bill.
Congress would have to specify the exact dollar amount of a new borrowing cap - likely upwards of $30 trillion.
Both chambers would have to approve the new process first, and then the Senate, followed by the House, would pass the extension by simple majority votes.