The Senate ended the threat of a U.S. default on its financial obligations by passing the Fiscal Responsibility Act of 2023 on June 1. The measure now moves to the desk of President Joe Biden, whose signature will lay the matter to rest for at least the next 19 months.
The bill passed in a bipartisan vote of 63 to 36.
The legislation resulted from a compromise forged by President Joe Biden and House Speaker Kevin McCarthy (R-Calif.) to suspend the debt limit through Jan. 1, 2025, while making slight reductions to non-defense discretionary spending and modest increases in defense spending in 2024. Discretionary spending growth is capped at 1 percent for 2025.
The bill also makes changes to work requirements for some social welfare programs, streamlines the permitting process to drill for oil and natural gas, and takes back $20 billion in IRS funding and $30 billion in unspent COVID relief funds, among other provisions.
With a possible default just four days away, the usually slow-moving Senate passed the bill in an evening session just 24 hours after it cleared the House of Representatives.
“It is so good for this country that both parties have come together at last to avoid default. I thank my colleagues on both sides of the aisle for their cooperation,” Senate Majority Leader Chuck Schumer (D-N.Y.) said shortly before the vote.
Sen. 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 primary concern Republican senators voiced about the bill was what they saw as an inadequate amount of military spending.
Citing the growth in military spending and activity by China and other nations, senators including Tom Cotton (R-Ark.), Susan Collins (R-Maine), and Lindsey Graham (R-S.C.) criticized the bill for including a provision to cut defense spending automatically if a federal budget is not passed on time.
“The continuing resolution, if we don’t do our legislative business, increases non-defense spending, decreases defense spending,” Graham said while debating the bill on June 1. “If this budget is the end of the discussion and we don’t fix it, your sons and daughters are going to have more war, not less.”
“This bill would actually shrink the size of our navy,” Collins said. “Meanwhile, China has the largest navy in the world now.” Collins called for an emergency supplemental allocation 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 out, actually, it increases spending 3.3 percent next year. And the year after that it increases spending 1 percent again. It actually doesn’t decrease spending at all,” Lankford said while debating the bill on June 1.
Some senators opposed the bill because of the additional work requirements it imposes on some recipients of social services while preserving tax cuts for the wealthiest Americans and large corporations.
“At a time of massive inequality and when the people on 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 while debating the bill on June 1.
Former President Donald Trump voiced his opinion on the bill to a campaign audience in Iowa while the Senate deliberated on June 1. “We should have gone through a little more pain, perhaps, over the last few days to get maybe a deal done,” Trump said.
To speed consideration of the bill, Republicans and Democrats agreed to permit only 11 amendments to be offered and limited debate to four to six minutes on each. All amendments failed.
As the evening wore on, Schumer urged senators to vote quickly. At one point he was overheard saying to Sen. John Cornyn (R-Texas), “Less talking, more voting.”
While many senators applauded the bill for avoiding 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,” Sen. Jeanne Shaheen (D-N.H.) told The Epoch Times on June 1. “But that’s what governing is about. It’s about making compromises.”
Jackson Richman contributed to this report.