Trump intervened to lower the US debt ceiling bill. What happens next? | Donald Trump News

The US Congress has until midnight Friday to pass a bill increasing the country's borrowing limit, also known as the debt ceiling, without which large parts of the government could cease to function.

A bill that would have extended the deadline to March 14, prepared by both Democrats and Republicans, was scuttled after President-elect Donald Trump announced his opposition on Wednesday, following the efforts of his billionaire ally Elon Musk to arouse opposition.

A Republican spending bill approved by Trump, which would have linked the extension of government funding to a two-year suspension of the federal debt ceiling, failed to pass the US House of Representatives on Thursday evening, leaving the dead end with no way out.

What is the debt ceiling, why is it so controversial, and what can this latest episode teach us about Musk and his growing influence on American politics?

What is the debt ceiling?

The debt ceiling is a cap imposed by the U.S. Congress on the amount the government can borrow to close the gap between its revenues and spending.

How often is the debt ceiling raised?

The United States has raised the debt ceiling 103 times since 1939, and it has been a largely procedural act in American politics for most of that time.

Failure to raise the debt ceiling means the U.S. Treasury could have difficulty making payments on the country's debt, which could rattle global financial markets and damage the country's vaunted credit rating.

When did the debt ceiling become so controversial?

In 1995 and 1996, a Republican-controlled Congress, led by the more confrontational House Speaker Newt Gingrich, used the prospect of letting the debt ceiling expire to push for additional debt reductions. spending by then-President Bill Clinton.

Although often presented as a principled position in favor of fiscal rectitude, debt ceiling negotiations have become a political opportunity for often minority parties to use their influence to extract concessions from the rival party or of the president. They can also become occasions where rival factions within a party compete over priorities.

One such standoff took place between December 2018 and January 2019, during Trump's first term, when the Republican rejected a COVID-19 relief bill by insisting on provisions for more aggressive anti-immigration measures.

The shutdown became the longest in U.S. history and was widely seen as politically damaging to Trump and the Republicans.

What role does Trump play in the current negotiations?

The president-elect wields considerable influence over the conservative Republican Party, and his announcement Wednesday of his opposition to the bipartisan debt ceiling bill was enough to ensure his demise.

What does Trump want to see instead?

After defeating the bipartisan spending bill, Trump threw his support behind a hastily crafted spending package that included, at his request, a two-year suspension of the debt ceiling.

Democrats say suspending the debt ceiling would make it easier for Trump to enact promised tax cuts that would add trillions of dollars to the growing national debt.

In an interview with NBC News on Thursday, Trump said removing the debt ceiling entirely would be the smartest thing Congress could do.

I would fully support that, he said.

The House rejected the Trump-approved spending package by a 235-174 vote, with nearly 40 far-right Republicans joining Democrats in opposing the bill.

What will Republican lawmakers do now?

Republican House Majority Speaker Mike Johnson must now go back to the drawing board and quickly craft a new spending plan acceptable to lawmakers if he wants to avoid the shutdown deadline.

It is far from certain that this will be possible in the limited time that remains.

Trump's intervention has put Johnson in a bind, as he faces the task of convincing Congress without clashing with the new Republican president just weeks before facing his own fight to retain his current leadership position.

Anyone who supports a bill that doesn't address the Democratic quicksand known as the debt ceiling should be prioritized and eliminated as quickly as possible, Trump told Fox News.

Before the previous bipartisan bill failed, Trump and Musk warned Republican lawmakers of consequences if they supported the spending package.

Some lawmakers were caught off guard, saying Trump complicated their efforts by intervening at the last minute to upend negotiations.

President Trump's last-minute request to eliminate the debt ceiling throws a whole new question into the debate, said Sen. Susan Collins, the top Republican on the Senate Appropriations Committee.

At the same time, the failure of Trump's proposed alternative spending plan has exposed the limits of his influence over his party, suggesting that he cannot count on Republicans to cater to his every whim.

What role did Elon Musk play?

Billionaire tech mogul Elon Musk, who has become a key Trump ally and power broker within the Republican Party, used social media to rally opposition to the bipartisan bill, which he described as full of excessive spending.

My phone was ringing off the hook, Republican Rep. Andy Barr said Wednesday. The people who elected us listen to Elon Musk.

After the House rejected the Trump-backed alternative bill on Thursday, Musk blasted Democrats for their opposition to the fair and simple proposal.

Objectively, the vast majority of Republican members of the House voted for the spending bill, but only two Democrats did so. Therefore, if the government shuts down, it is obviously the fault of the Democratic Party. Plain and simple, Musk said on X.

What does this say about Musk's emerging role in the Trump administration?

Musk has positioned himself as an activist against government spending and regulation. He is set to lead the Department of Government Effectiveness (DOGE) in the incoming Trump administration, which will seek to cut about $2 trillion in federal spending in the annual budget.

If Musk presents himself as a fighter against government largesse, many Democrats see something else: the world's richest man wielding his power, without elected office, to reshape government in favor of private industry.

What are Democratic lawmakers saying?

Democrats used the sudden collapse of the bipartisan bill to portray the Republican Party as willing to put its loyalty to Donald Trump and wealthy figures like Elon Musk above its responsibilities as lawmakers.

This reckless Republican-instigated shutdown can be avoided, House Democratic Leader Hakeem Jeffries said, adding that Republicans should simply do what's right for the American people and stick to the bipartisan agreement that they negotiated themselves.

Others have pointed out that conservatives pushing to cut these programs are also considering extending a series of tax cuts from Trump's first term that have largely benefited the ultra-rich.

This would cost the government about $4 trillion in lost revenue over the next 10 years, adding to the government's current debt of about $36 trillion.

Democrats could respond positively to Trump's proposal to eliminate the debt ceiling, which Republicans have long used as an opportunity to call for deep cuts to social programs.

I agree with President-elect Trump that Congress should end the debt ceiling and never again govern by hostage taking, Sen. Elizabeth Warren said Thursday.

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