SAN FRANCISCO (KCBS RADIO) – Lawmakers voted Thursday to increase the U.S. debt limit, just making the June 1 cutoff date previously provided by Treasury Secretary Janet Yellen.
Politicians from both sides of the aisle in Washington have described the “Fiscal Responsibility Act of 2023” as a success, but what is in it, exactly?
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First, it extends the debt limit through Jan. 1, 2025, “increases the limit on January 2, 2025, to accommodate the obligations issued during the suspension period,” and establishes new discretionary spending limits. These limits will apply to the 2024 and 2025 fiscal years.
Another notable feature of the bill is a provision to terminate the suspension of federal student loan payments. However, in remarks on the legislation issued Thursday, President Joe Biden said “it protects my student debt relief plan for hardworking borrowers.”
KCBS Radio’s Margie Shafer spoke with Rory Little, Professor at UC College of the Law, to get a closer look at how the bill will impact people with student loans.
Further provisions of the bill include measures to:
· Rescind certain unobligated funds that were provided to address COVID-19
· Provide funding for the Department of Veterans Affairs Cost of War Toxic Exposure Fund
· Provide funding for the Department of Commerce Nonrecurring Expenses Fund;
· Provide statutory authority through 2024 for the requirement for agencies that propose certain administrative actions that will increase direct spending to also propose at least one administrative action that will decrease direct spending by at least the same amount
· Expand work requirements for the Supplemental Nutrition Assistance Program (SNAP) and the Temporary Assistance for Needy Families (TANF) program
· Expedite the permitting process for certain energy projects
According to Senate Majority Leader Chuck Schumer (D-N.Y.), Democrat lawmakers in the House and Senate ““beat back the worst of the Republican agenda,” in the final version of the bill. He also said that “of course, nobody got everything they wanted.”
“I voted for the Fiscal Responsibility Act because it is the only way to avoid a default on the national debt just four days from now,” said U.S. Senator Lisa Murkowski (R-Alaska). “While both the bill itself and the process that led to it were far from perfect, it will avert an economic disaster, protect the full faith and credit of the United States, and slightly improve our nation’s fiscal trajectory.”
According to a Congressional Budget Office assessment of the bill issued May 30, the legislation would reduce the agency’s projections of budget deficits by about $1.5 trillion over the 2023–2033 period relative to its May 2023 baseline projections.