After Congress rejected President-elect Donald Trump’s main debt demands in the package and adopted a temporary funding plan only before the deadline, President Joe Biden signed a bill into law on Saturday that prevents a government shutdown, capping days of turmoil.
The agreement gives farmers $10 billion in agricultural support and $100 billion in disaster relief, while funding the government at current levels through March 14.
“This agreement ensures the government can continue to operate at full capacity and represents a compromise, meaning neither side got everything it wanted,” Biden said in a statement. For Americans, that is good news.
House Speaker Mike Johnson, a Republican from Louisiana, had urged lawmakers to fulfill their responsibilities and prevent the closure of federal functions. However, Trump had insisted that the deal include a raise in the government’s borrowing limit, so the conclusion at the end of a turbulent week was uncertain. Otherwise, he had stated, let the closures begin at this time.
After midnight, Johnson’s amended plan was adopted 366-34 and passed by the Senate by a vote of 85-11. The White House claimed to have stopped preparing for the shutdown by that point.
Senate Majority Leader Chuck Schumer, a Democrat from New York, stated that there will be no government shutdown.
Johnson, who had spoken with Trump following the House vote, stated that the agreement was a positive development for the nation and that the president-elect was undoubtedly pleased with it as well.
The result was the third attempt by the embattled speaker, Johnson, to meet one of the fundamental conditions for the federal government to remain open. The challenges made it unclear if Johnson would be able to continue working with Trump and his billionaire ally Elon Musk, who was directing the legislative plays from a distance, while still keeping his job in the face of irate Republican coworkers.
When the new Congress meets on January 3, 2025, the House will elect the next speaker. Johnson will have little leeway as he attempts to capture the speaker’s gavel because the Republicans will have a very slim majority (220–215).
Rep. Andy Harris of Maryland, a Republican in the House, said he was still unsure about the GOP leadership and chastised Republicans for the bill’s deficit spending. Other people are also expressing dissatisfaction with Johnson.
However, Trump’s last-minute demand for a debt ceiling was nearly hard to comply with, and Johnson was forced to circumvent the pressure. Since many Republican budget hawks would rather cut the federal government than authorize more debt, the speaker was aware that the narrow Republican majority would not be sufficient to enact any spending agreement.
Rather, with their ambitious plans for tax cuts and other goals, the Republicans—who will hold complete control of the White House, House, and Senate in the coming year—are demonstrating that they frequently need to rely on Democrats for the votes they need to continue running the government.
The government’s borrowing costs have increased due to the coronavirus pandemic and the approximately $36 trillion federal debt, so that next year’s debt service will surpass national defense spending. Legislators last increased the debt ceiling in June 2023. Instead than increasing the debt ceiling by a certain amount, lawmakers decided to postpone it until January 1, 2025.
Since the Treasury Department can start using what it refers to as exceptional measures to make sure that America doesn’t default on its debts, there is no need to raise that cap at this time. According to some estimates, the default date might be moved to the summer of 2025 as a result of these accounting tricks. However, since an increase would be required while he was president, that was what Trump wished to prevent.
The debt ceiling will be discussed in the new year as part of tax and border measures, according to GOP leaders. At that time, Republicans reached a so-called “handshake” agreement to increase the debt ceiling while also reducing expenditure by $2.5 trillion over a ten-year period.
With Trump’s debt demand removed, it was basically the same deal that fell apart on Thursday night. But it s far smaller than the original deal Johnson struck with Democratic and Republican leaders a 1,500-page bill that Trump and Musk rejected, forcing him to start over. It was stuffed with a long list of other bills including much-derided pay raises for lawmakers but also other measures with broad bipartisan support that now have a tougher path to becoming law.
Trump, who has not yet been sworn into office, is showing the power but also the limits of his sway with Congress, as he intervenes and orchestrates affairs from Mar-a-Lago alongside Musk, who is heading up the new Department of Government Efficiency.
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