WASHINGTON, Dec. 7 (Xinhua) -- U.S. Republican and Democratic lawmakers have agreed on a plan to break a partisan impasse and raise the federal government's debt limit, Bloomberg News reported on Tuesday.
The plan would link a procedure to raise the debt limit with only Democratic votes to a bill to prevent automatic Medicare cuts, the report said.
Lawmakers would then pass a separate bill to raise the debt limit by about 2 trillion U.S. dollars to put the issue to rest until after the midterm election in November next year, according to the report.
If the plan goes through, the debt limit increase could pass Congress before Dec. 15, the date after which the U.S. Treasury Department said the government may run short of authority to pay its bills.
"I cannot overstate how critical it is that Congress address this issue. America must pay its bills on time and in full. If we do not, we will eviscerate our current recovery," U.S. Treasury Secretary Janet Yellen told lawmakers last week.
"There is uncertainty about where we will be on December 15th, and there are scenarios in which we can see it would not be possible to finance the government," she said.
Failure to pay the nation's bills on time could send immediate ripple effects throughout the global economy, particularly during a time of economic recovery and heightened uncertainty over a new COVID-19 variant, according to the Bipartisan Policy Center, a Washington, D.C.-based think tank.
The debt limit, commonly called the debt ceiling, is the total amount of money that the U.S. government is authorized to borrow to meet its existing legal obligations, including social security and medicare benefits, interest on the national debt, and other payments. Enditem