The U.S. debt ceiling is not a particularly interesting topic, but it's the limit our government can spend before it defaults — almost like a consumer credit card. And while it's just a number to many, you might feel the effects based on what comes out of negotiations between Democrats and Republicans on Capitol Hill in the months to come.
In June 2023, former President Joe Biden suspended the debt ceiling with the Fiscal Responsibility Act, temporarily staving off an economic crisis. Then on Jan. 2 of this year, the ceiling was reinstated at its current level of $36.1 trillion, with the U.S. using what it calls "extraordinary measures" to keep spending money in the interim.
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This week, House Speaker Mike Johnson said he'd be willing to negotiate with Democrats to raise the debt ceiling, something President Donald Trump has said he wants to get rid of entirely.
The debt ceiling has never been exceeded in U.S. history. But if it were to happen, it would mean the government wouldn't have enough money to pay for things like Social Security, Medicare, or many of the other programs that millions of Americans rely on every day.
"Congress and the Trump administration are very keenly aware that sometime in the next couple of months — if we're to avoid an economic catastrophe — [they're] going to have to raise the debt ceiling," said David Wessel, director at the Hutchins Center on Fiscal and Monetary Policy. "And what they're doing now is negotiating over what else will be part of that package."
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These ongoing negotiation over the debt ceiling will ultimately decide how everyday Americans are impacted. And even though Republicans control both chambers of Congress, there are a handful who might not vote to raise the debt limit.
That means President Trump will likely need to win over the support of at least a few Democratic lawmakers in Congress. But since Republicans in the past have used the debt ceiling issue as a bargaining chip to negotiate spending cuts, it will be interesting to see what Democrats ask for this time around.
While there's no pressing decision on the issue expected anytime soon, we can anticipate negotiations will pick up in the coming months.
