US President Barack Obama signed emergency debt-limit legislation to avoid an unprecedented national default that he said would have devastated the US economy, closing out months of rancorous debate that nearly paralyzed Washington.
Just hours before a midnight deadline, Obama signed the bill that begins the process of curbing the country’s spiraling debt and avoids a default by increasing the US$14.3 trillion cap on borrowing. Obama signed the legislation into law shortly after the US Senate passed it on Tuesday. The US House of Representatives approved the legislation on Monday night.
Though the compromise deal passed, it deeply angered both conservative Republicans and liberal Democrats. Conservatives said it did to little to shrink government and slash spending. Liberals bemoaned cuts to safety net programs they had fought to keep in place for years.
A stern-faced Obama said at the White House that raising the debt limit was essential, but more — and different — economic steps were badly needed.
“We’ve got to do everything in our power to grow this economy and put America back to work,” the president said, arguing, as he has throughout the debt controversy, that fixing the economy requires increased tax revenues in tandem with spending cuts.
He said that must happen in the upcoming November attempt to whittle still more out of the budget.
The compromise deal to persuade Republican lawmakers to raise the federal debt limit will cut US federal spending by US$2.1 trillion or more over the next decade, but Obama immediately challenged Republicans to accept higher taxes on the wealthy in the November round of deficit cuts later this year.
Obama placed his signature on the bill less than two hours after a 74-26 vote in the Senate. The House approved the measure on Monday night on a 269-161 roll call that also reached across party lines and was sealed by a rap of the gavel by House Speaker John Boehner.
The bill sets up a powerful 12-member committee of lawmakers with authority to recommend fresh deficit savings from every corner of the federal budget.