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House Republicans approve debt ceiling increase in an effort to prompt negotiations with Biden administration.

The U.S. House of Representatives narrowly passed a bill to raise the government’s debt ceiling on Wednesday. The bill, which includes sweeping spending cuts over the next decade, is unlikely to pass the Senate, and President Joe Biden would veto it if it did. However, the 217-215 mostly partisan vote represents a win for Republican House Speaker Kevin McCarthy on an issue that rattled investors and markets. McCarthy hopes to lure Biden into negotiations on cutting spending, even as the White House and congressional Democrats insist on a debt limit increase with no strings attached.

If Congress fails to act, the U.S. Treasury Department could run out of ways to pay its bills in a matter of weeks, and financial markets are already flashing warning signs. A 2011 standoff led to a downgrade of the government’s credit rating, which pushed borrowing costs higher and hammered investments.

The House bill would increase Washington’s borrowing authority by $1.5 trillion or until March 31, whichever comes first, raising the specter of another round of negotiations during the 2024 presidential campaign. The bill would pare spending to 2022 levels and then cap growth at 1% a year, repeal some tax incentives for renewable energy, and stiffen work requirements for some antipoverty programs.

Democrats say the bill is “dead on arrival” in the Senate and that the Republican measure “only brings us dangerously closer” to a historic U.S. debt default that would shake markets and economies worldwide. Democrats control the Senate with 51 votes.

Throughout debate on the bill, Republicans cast Democrats as free-wheeling spenders of taxpayer money, which they say has pushed the national debt into a danger zone. Democrats, meanwhile, bemoaned the deep spending cuts the measure would bring on programs, including healthcare for the poor, Head Start education for pre-schoolers, and an array of other programs, including law enforcement and airport security operations.

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