The Senate ended the threat of a US fiscal default by passing the Fiscal Responsibility Act of 2023 on June 1. The measure now moves to President Joe Biden's desk, whose signature will put an end to the issue for at least 19 months.
The bill was passed by a bipartisan vote of 63 to 36.
The legislation emerged from a compromise reached by President Joe Biden and House Speaker Kevin McCarthy (Calif.) to suspend the debt limit until Jan. 1, 2025, while making slight reductions in non-defense spending and modest increases in defense spending in 2024. The discretionary spending increase is limited to 1 percent for 2025.
The bill also makes changes to work requirements for some welfare programs, streamlines the permitting process for oil and gas drilling, and claws back $20 billion in IRS funding and $30 billion in unused COVID relief funds, among other provisions .
With a possible impasse just four days away, the usually slow-moving Senate passed the bill in an afternoon session just 24 hours after it was approved by the House of Representatives.
“It is so good for this country that both parties have finally agreed to avoid bankruptcy. I thank my colleagues on both sides of the aisle for their cooperation,” Senate Majority Leader Chuck Schumer (DN.Y.) said shortly before the vote.
Senate Minority Leader Mitch McConnell (R-Ky.) called it "an urgent and important step in the right direction for the health of our economy and the future of our country" during remarks on the Senate floor.
Defense spending concerns
The main concern expressed by Republican senators about the bill was what they saw as an insufficient amount of military spending.
Citing increased military spending and activity by China and other nations, senators including Tom Cotton (R-Ark.), Susan Collins (R-Maine) and Lindsay Graham (R.C.) criticized the bill to include a provision to automatically cut defense spending if the federal budget is not passed on time.
“The continuing resolution, if we don't do our legislative work, increases non-defense spending, decreases defense spending,” Sen. Lindsay Graham (RS.C.) said during the June 1 debate on the bill. "If this budget is the end of the conversation and we don't fix it, your sons and daughters will have more war, not less."
"This bill will really shrink the size of our navy," Collins said. "Meanwhile, China has the largest navy in the world now." Collins requested an emergency supplemental appropriation to further increase defense spending in 2024.
Sen. James Lankford (R-Okla.) opposed the bill, saying it would actually increase, not decrease, federal spending.
“I get to the fine print and find that, in fact, it increases spending by 3,3 percent next year. And next year it increases spending again by 1%. It doesn't actually reduce spending at all,” Lankford said during the June 1 debate on the bill.
Some senators opposed the bill because of the additional work requirements it imposes on some welfare recipients while maintaining tax cuts for the wealthiest Americans and large corporations.
"In a time of tremendous inequality and when the people at the top have never had it so good, I cannot in good conscience vote for a bill that hurts working people," Sen. Bernie Sanders (I-Vt.) said during the debate. of the bill on June 1.
Former President Donald Trump voiced his opinion on the bill at a campaign audience in Iowa while the Senate was debating on June 1. Trump said.
Amendments defeated
To speed up consideration of the bill, Republicans and Democrats agreed to allow only 11 amendments to be offered and limited debate to four to six minutes for each. All amendments failed.
As the evening wore on, Schumer urged senators to vote quickly. At one point he was heard telling Sen. John Cornyn (R-Texas), "Less debate, more voting."
While many senators applauded the bill for averting a catastrophic financial default, none seemed particularly excited about its provisions.
"I think what we have is a compromise that doesn't have what everybody wants," said Sen. Jeanne Shaheen (DN.H.). "But that's what governance is all about. It's about compromises."
