WASHINGTON – Congress gave final approval Thursday to a plan to temporarily suspend the legal limit on the national debt, permitting the Treasury Department to keep borrowing and lifting the threat of a government default until August.
The measure, approved by the Senate 64-34, now goes to the White House for President Obama’s signature. Without congressional action, the administration had been warning that the Treasury would run out of money to pay the nation’s bills by early March.
The bill passed with the support of Maine’s senators, Republican Susan Collins and independent Angus King. Maine’s two Democratic House members had previously split on the issue, with Rep. Mike Michaud supporting the extension and Rep. Chellie Pingree opposing it.
King, a member of the Senate Budget Committee, had frequently touted his support for a “no budget, no pay” requirement during last fall’s campaign, and he praised the provision’s inclusion in the bill as a way to hold Congress accountable.
Collins supported two of the failed amendments that she said would have “allowed a debate on real spending reforms” to address the $16.4 trillion debt but she voted for the overall bill. In a statement afterward, Collins accused the Obama administration of delaying action on spending, although the bill to suspend the enforcement of the debt ceiling was drafted by House Republicans.
The House passed the bill last week, days after Republican leaders announced that they would not try to use the moment as leverage in their battle with Obama over the federal budget. But House leaders said that they would not vote to raise the $16.4 trillion debt limit — a politically dicey move for which they have in the past demanded deep spending cuts.
Instead, they offered a novel plan to suspend enforcement of the limit through May 18. Under the measure, the Treasury Department can simply ignore the debt ceiling and keep borrowing.
On May 19, the debt limit will kick back in and automatically reset at a higher level. Treasury officials can then begin taking “extraordinary measures” to keep paying the nation’s bills.
Analysts at the Bipartisan Policy Center predict that the Treasury will run up about $450 billion in additional debt through mid-May, and that the date of a potential default will be postponed until August or later.
Kevin Miller, Maine Today Media Washington bureau chief, contributed to this story.