U.S. Senate will vote Tuesday on a compromise bill to cut government
spending and raise the nation's borrowing limit, bringing a likely end
to weeks of fear over a potential American debt default.
The Senate is expected to vote on the deal at noon local time, just 12
hours before the government says it will run out of money to pay its
On Monday night, the bill passed its biggest test when the
Republican-led House of Representatives approved it by a vote of 269 to
If the legislation passes the Senate Tuesday, it will be sent to
President Barack Obama, who has said he is anxious to sign the bill.
The deal would allow the government to continue borrowing money through
2012 in exchange for spending cuts of almost $1 trillion over the next
The package would also create a bipartisan budget committee tasked with
finding additional cuts of $1.5 trillion. If the panel fails to reach an
agreement, then the deal would trigger additional spending cuts.
party leaders say they expect the deal to pass its final hurdle in the
Senate, many lawmakers are still reluctant to support it. Some
conservatives say the package does not cut enough spending, and liberals
complain the cuts are too deep and that the bill does not raise taxes on
Meanwhile, it is not clear if the deal contains enough spending cuts to
avoid a downgraded credit rating. Standard & Poor's credit rating agency
had threatened to downgrade America's AAA rating unless Congress passed
at least $4 trillion in deficit cuts.
A downgraded credit rating would mean it would cost more for the
government to borrow money, which could in turn raise interest rates on
many consumer loans.