(MENAFN) The text of a crucial agreement to increase the United States debt limit has been made public, setting the stage for a Congressional vote expected to take place as early as Wednesday. Treasury Secretary Janet Yellen has sounded the alarm, warning that failure to raise the debt ceiling could lead to a potentially catastrophic default on the country's financial obligations, with the risk becoming imminent as early as June 5.
Released to the public, the 99-page "Fiscal Responsibility Act of 2023" outlines the provisions to raise the debt limit for a span of two years and establishes discretionary spending limits that will be in effect until 2029. Notably, the defense budget for the years 2024 and 2025 receives a substantial allocation of USD886 billion and USD895 billion, respectively, while non-military discretionary programs are earmarked a comparatively smaller amount of USD637 billion.
While the agreement incorporates some spending reductions, it falls short of the extensive cuts demanded by Republicans. One notable measure involves rescinding USD1.4 billion that had previously been allocated to the Internal Revenue Service as part of a controversial expansion under the Inflation Reduction Act. Additionally, the agreement seeks to reclaim USD28 billion in unspent Covid-19 funding, ensuring that unused resources are redirected for other purposes.
The release of the agreement's text brings the nation one step closer to resolving the ongoing debate over the debt ceiling and averting a potentially disastrous financial crisis. As Congress prepares for the forthcoming vote, policymakers and analysts will closely scrutinize the proposed legislation, evaluating its potential impact on the country's fiscal health, economic stability, and broader financial outlook.
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