The last hurdle for the debt ceiling deal

Breathe a sigh of relief: We have a debt ceiling deal. But this long saga that none of us asked for isn’t quite over yet. 

What happened: President Joe Biden and Speaker Kevin McCarthy struck a deal to raise the debt ceiling over the weekend, but it still needs to be approved by Congress—and that’s no sure thing.

  • In addition to lifting the ceiling until 2025, Biden and McCarthy also agreed to cap some non-military federal spending and add new limits on who could receive aid through anti-poverty programs.

Why it matters: The deal is a big step towards putting the debt ceiling showdown that threatened to upend the global economy behind us (at least for a couple of years when we may do this all over again).

Yes, but: Biden and McCarthy still have to find enough votes to get the deal through Congress.

  • Some members of the House Freedom Caucus—a group of 45 of the most conservative Republicans in Congress—have said they will vote against the agreement.
  • Republicans have a 222-213 majority in the House, so they will almost certainly need a significant number of Democratic votes to get the deal passed.

What’s next: The House will likely vote on the deal on Wednesday. If passed, it will need to speed through the Senate to come into effect ahead of the June 5th deadline after which the US Treasury says it will run out of cash.