Lawmakers Reach Deal to Raise Debt Limit

December 9, 2021

On Tuesday, the House approved legislation by a 222 to 212 vote that will pave the way for an increase to the debt ceiling after both sides agreed to an unusual procedure. The procedural measure will limit the Senate debate on a separate debt ceiling increase bill to 10 hours and bypass a lengthier debate process.

Under the terms of the House bill, the proposal is tied to legislation that would postpone scheduled cuts to Medicare, farm aid and other mandatory spending programs that were set to occur next year. Once that legislation is passed, Senate Majority Leader Chuck Schumer (D-N.Y.), will need to introduce a joint resolution no later than Dec. 31 to increase the $28.9 trillion debt ceiling by an amount yet to be determined. After that, only one cloture vote would be needed with a simple majority vote being the threshold for passage. 

The special procedure, which Senate Minority Leader Mitch McConnell (R-Ky.), has already endorsed, won’t be used to pass any other piece of legislation and will expire on Jan. 16. Senate Majority Leader Chuck Schumer (D-N.Y.), and Senate Minority Leader Mitch McConnell (R-Ky.), previously reached a compromise to allow Democrats to quickly increase the debt ceiling without Republican interference. The Treasury Department has said it will reach its borrowing limit as soon as Dec. 15.

Sens. McConnell and Schumer had originally floated attaching that procedural plan to the annual defense authorization bill but will instead embed it with a measure to put off cuts to Medicare that were otherwise scheduled to take place. It gives the Senate through Jan. 15 to pass a debt ceiling increase with the special conditions in place. 

If Congress manages to pass the measure, it will mark the second crisis averted this month for federal agencies. President Biden last week signed into law a 10-week stopgap funding bill, giving Congress until Feb. 18 to produce full-year appropriations and avoid a shutdown.