US Congress passes two-year budget deal

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EPA

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Mitch McConnell said the bill would prevent any debt crisis

The US Senate has approved a two-year federal budget deal that includes big spending increases.

The bill, which has already been passed by the House of Representatives, will suspend government borrowing limits until the end of July 2021.

It sets government spending at $1.37 trillion (£1.12tn) for the next financial year, beginning in October.

Lawmakers said it would avert a budget crisis in the run-up to next year’s presidential election.

However, it looks certain to add to already high levels of US government debt, which already stands at $22.5tn.

The bill now goes for signing by President Donald Trump, who has described the deal as “phenomenal”.

The Senate majority leader, Republican Mitch McConnell, said the legislation “ensures our federal government will not approach any kind of debt crisis in the coming weeks or months”.

It passed by 67 votes to 28 with cross-party support, despite some opposition from conservative Republicans who were concerned at the high levels of spending.

One Republican senator, Rand Paul, who voted against the bill, said: “This may well be the most fiscally irresponsible thing we’ve done in the history of the United States.”

Under the bill, defence spending will go up from $716bn this year to $738bn next year, while non-defence spending will rise from $605bn to $632bn.

Treasury Secretary Steven Mnuchin had warned that if the bill failed to pass, the government could run out of money during the summer Congressional recess, triggering another government shutdown.

The last time that happened, in January, it cost the US economy an estimated $3bn.

source: bbc.com