Congress has reached an agreement to raise the debt ceiling as well as make deep cuts in the federal debt. The agreement requires up $2.4 trillion in deficit reduction and a maximum $2.4 trillion increase in the debt limit in two stages. It immediately produces $917 billion in savings through FY 2021 by capping discretionary spending each year, and provides for a $900 billion increase in the debt ceiling. The agreement also creates a 12-member joint congressional committee to develop a plan for an additional $1.5 trillion in deficit reduction that Congress would vote on in December.
While the debt ceiling agreement reached this week has averted an economic default that would have had catastrophic consequences for the global economy, it comes at a steep price. Unfortunately, the process for reaching an agreement has resulted in a deficit reduction plan that asks those who are least able to afford it to bear a disproportionate share of the burden in reducing the debt. Essential services to children, seniors, people with disabilities, the unemployed and uninsured will be drastically cut to help reduce the debt.
To learn more about the impact of the debt ceiling agreement on low-income communities, please find out how to be a part of a special webinar sponsored by the Interreligious Working Group on Domestic Human Needs.