President Joe Biden Signs Debt Ceiling Bill That Pulls U.S. Back From Brink of Unprecedented Default

With only two days to spare, President Joe Biden signed legislation Saturday that lifted the nation’s debt ceiling, averting an unprecedented default on the federal government’s debt.

The low-key end to the monthslong drama that had unnerved financial markets worldwide caused anxious social service organizations and investors to make contingency plans in case the country could not pay its bills.

Instead of having a public ceremony with lawmakers from both parties, the president signed the legislation privately.

The Treasury Department warned that the country would start running short of cash Monday, which would have sent shockwaves through the United States and global economies.

The White House released a photo of the president signing the legislation at the Resolute Desk. In a short statement, the president thanked Republican and Democrat congressional leaders for their partnership in a cordial message that contrasted with the venom that first characterized the debt debate.

“No matter how tough our politics gets, we need to see each not as adversaries, but as fellow Americans,” said Biden in a video message released after the signing. He said it was important to “stop shouting, lower the temperature, and work together to pursue progress, secure prosperity, and keep the promise of America for everybody.”

The standoff started when Republicans refused to raise the country’s borrowing limit unless Democrats agreed to cut spending. Finally, the White House began weeks of intense negotiations with Speaker of the House Kevin McCarthy of California to reach a bipartisan deal.

Final deal passed by House, then Senate

The final deal, passed by the House on Wednesday, was followed by the Senate on Thursday, suspends the debt ceiling until 2025 — after the 2024 presidential election — and restricts federal spending. It gives legislators budget targets for the next two years to guarantee fiscal stability as the political season heats up.

Raising the nation’s debt limit, now at $31.4 trillion, will ensure the government can borrow to pay debts already incurred.

After Congress passed the legislation, the president used the occasion to deliver his first speech from the Oval Office while president on Friday.

“No one got everything they wanted, but the American people got what they needed,” said Biden, highlighting the “compromise and consensus” in the deal. “We averted an economic crisis and an economic collapse.”

President Biden touted the achievements of his first term as he began campaigning for reelection, including support for infrastructure investments, financial incentives for fighting climate change, and support for high-tech manufacturing. He also emphasized ways he blocked GOP efforts to roll back his agenda and achieve deeper cuts.

“We’re cutting spending and bringing deficits down at the same time,” said Biden. “We’re protecting important priorities from Social Security to Medicare to Medicaid to veterans to our transformational investments in infrastructure and clean energy.”

The president’s remarks were his most detailed comments on the deal he negotiated with his staff. He has largely remained silent during the high-stakes talks, a move that has frustrated some members of his party but was a decision intended to give space to both sides to reach a deal and allow legislators to vote it onto his desk.

President Biden praised Speaker McCarthy and his negotiators for negotiating in good faith and all congressional leaders for swiftly passing the legislation. “They acted responsibly and put the good of the country ahead of politics.”