WASHINGTON, D.C. — A government shutdown was averted with only hours to spare.
President Joe Biden signed a short-term funding bill Thursday night. It will keep the government funded through early December.
The measure passed in the House and Senate earlier in the day.
The stopgap spending legislation will also provide aid for those reeling from Hurricane Ida and other natural disasters, as well as funding to support Afghanistan evacuees from the 20-year war between the U.S. and the Taliban.
While Congress moved to avert one crisis, it’s putting off another.
Democrats were forced to remove a suspension of the federal government's borrowing limit from the bill at the insistence of Republicans.
The top priority for lawmakers at the moment is keeping the government funded to avoid a shutdown. But Treasury Secretary Janet Yellen warns that if the debt limit isn't raised by Oct. 18, the country would likely face a financial crisis and economic recession.
"At that point, we expect Treasury would be left with very limited resources that would be depleted quickly. It is uncertain whether we could continue to meet all the nation's commitments after that date," Yellen wrote in a letter to lawmakers earlier this week.
Yellen warned that waiting until the last minute to address the debt ceiling can cause harm to business and consumer confidence, raise borrowing costs for taxpayers, and negatively impact the credit rating of the U.S. for years to come.
"Failure to act promptly could also result in substantial disruptions to financial markets, as heightened uncertainty can exacerbate volatility and erode investor confidence," she wrote.
Meanwhile, Democrats are struggling to find a way to pass President Joe Biden's proposed $3.5 trillion budget plan that would fund social programs like universal pre-K and other programs focused on working families — a plan that faces roadblocks from some moderate Democrats.
In order to get the bill passed, Biden will need the support of nearly all 50 Democratic senators due to the current 50-50 split in the Senate.
At a press conference Thursday, House Speaker Nancy Pelosi held a positive outlook on negotiations, saying that they are in a "good place" and that she does not plan to delay a vote on the package.