Weekly News Highlights: 1/2/2023 – 1/8/2023
Speaker Drama Raises New Fears on Debt Limit
After 15 votes, the House of Representatives has finally settled on Republican Kevin McCarthy as the Speaker of the House - the first time since 1923 that the House needed to conduct more than one vote to determine its Speaker.
However, this decision came with concessions that many say will jeopardize the next two years of Congress. Much of McCarthy's vocal opposition came from strongly conservative Republicans. In order to finally gain sufficient votes to win the speakership, McCarthy made deals to the far right such as making it much easier for lawmakers to oust a House speaker and slow down the passing of bills. Because of this, McCarthy is facing much backlash from especially moderates.
In addition to this leverage that McCarthy gave, a critical deal that he struck will make it much harder for Congress to raise the debt limit. Raising the debt limit at times is necessary for the US to continue essential processes like keeping the government open and paying salaries for military members, among others. Goldman Sachs researchers even believe that the debt limit will need to be raised in August of 2023 to prevent these situations from happening. However, with McCarthy's deal, it is unclear whether Congress would have the support to fight for a debt limit raise.