The House passed a bill Wednesday night to suspend the debt limit past the 2024 elections, sending to the Senate a bipartisan package designed to avert a financial crisis when borrowing authority runs out next week.

On a bipartisan 314-117 vote, the House endorsed legislation negotiated by Speaker Kevin McCarthy and President Joe Biden that would couple debt limit relief with caps on discretionary spending that Republicans said would serve as a down payment on deficit reduction efforts.

The bill won support from majorities of both parties, though more Democrats voted for it than Republicans. Republicans voted 149-71 for the bill, while Democrats voted 165-46.

The vote marked a victory for McCarthy, who beat back months of Democratic insistence on a “clean” debt limit increase without the spending cuts and other conservative policies Republicans demanded.

“Over the past four months, we worked hard to change how Washington works,” McCarthy said in floor debate. “We stopped the Democrats from writing a blank check for spending after the largest spending binge in American history brought us the worst inflation the nation has ever known.”

The bill now headed to the Senate is a far cry from the initial GOP-backed legislation the House passed last month, which included more dramatic cuts that promised $4.8 trillion in deficit savings through fiscal 2033.

The new compromise, which would hold domestic spending relatively flat and allow defense and veterans spending to increase, would likely save at most $2.1 trillion, the Congressional Budget Office estimated. 

Hard-line conservatives opposed the bill because it contains just a fraction of the deficit reduction that would have been required under the earlier House GOP debt limit bill. Left-leaning House Democrats opposed the bill over its expansion of work requirements for welfare programs and modifications made to the environmental review process for federal projects, among other complaints.

Democratic leaders rallied behind the compromise, saying it offered the best hope in a divided government to avoid the financial chaos that could be triggered by a debt limit breach.

“President Biden protected the American people from the types of devastating cuts proposed by right-wing extremists that would have hurt millions of everyday Americans,” said House Minority Leader Hakeem Jeffries, who urged his caucus to support the bill.

Breaking a sweat

Even so, Democrats decided to make Republicans break a sweat to move the bill across the finish line. The critical vote came earlier Wednesday, when the House needed to adopt a rule setting the terms of floor debate.

Rules are typically supported only by the majority party. But with hard-right Freedom Caucus members up in arms over a bill they consider too weak, Democrats made a point of showing that the GOP majority lacked the votes needed to adopt the rule on its own. With the rule about to be defeated, 52 Democrats voted “yes’” in the closing minutes to carry the rule to adoption.

The bill now moves to the Senate, where it is expected to pass by this weekend after Senate Majority Leader Charles E. Schumer and Minority Leader Mitch McConnell endorsed it.

But speed will be critical. Treasury Secretary Janet L. Yellen warned lawmakers the government may be unable to pay its bills beginning on Monday unless the debt ceiling is lifted by then.

That timeline presents a major challenge in the slow-moving Senate, where any one senator could choose to hold up plans to fast-track the legislation.

A few senators are pushing for votes on amendments, including Sen. Rand Paul, R-Ky., who wants an alternative plan with a shorter debt limit raise and more dramatic spending cuts. Sen. Tim Kaine, D-Va., wants to strike a provision that would greenlight the Mountain Valley Pipeline, which will ferry natural gas from West Virginia into Kaine’s state.

Passage of the legislation will mark the first time since the landmark budget deal of 2011 that lawmakers and the White House agreed to attach spending cuts to a debt limit increase.

That deal triggered a decade of spending caps that members of both parties came to regret, and prompted Biden to conclude he should never again negotiate on a debt limit increase. He ultimately backed down from that position to reach his deal with McCarthy, while insisting he was only negotiating on the budget, not the debt limit.

The bill would suspend the debt limit until Jan. 1, 2025, pushing it past the November 2024 elections. 

The debt limit was last raised in December 2021 to $31.4 trillion. Debt hit that level in January, prompting Treasury to implement what are called extraordinary measures to temporarily reduce debt and allow continued borrowing. Some informal estimates say the new legislation could allow for debt to increase to roughly $35 trillion.

Through a combination of caps on discretionary spending, rescissions of mostly pandemic spending and other changes, the package would save an estimated $1.5 trillion over a decade, and up to $2.1 trillion if Congress abides by additional caps from fiscal 2026 to fiscal 2029 that are not enforceable by a sequester, according to the Congressional Budget Office.

In fiscal 2024, the statutory caps would raise defense spending to $886 billion and lower nondefense spending to $704 billion, not including emergency spending and other funding outside the caps. Spending would be allowed to grow by 1 percent in fiscal 2025.

The caps would technically cut overall base discretionary spending to $1.59 trillion in 2024, from $1.602 trillion this year. However, actual nondefense appropriations next year may roughly equal spending this year. That is because negotiators agreed to adjustments that are not contained in the legislation, which will plow back some of the rescinded pandemic aid and some IRS enforcement money to make up for cuts in discretionary programs.

‘Lopsided’ deal

House Appropriations ranking member Rosa DeLauro, D-Conn., opposed the bill, arguing the measure’s side agreement to boost nondefense spending may not materialize while military budget boosts are locked in. “I can live with a painful compromise, but I cannot accept one so lopsided,” DeLauro said in a statement.

Senate Appropriations Chair Patty Murray, D-Wash., hasn’t commented publicly on the legislation since it was released. But according to Senate Majority Whip Richard J. Durbin, D-Ill., Murray told her colleagues at the caucus lunch on Wednesday that it could make the appropriations process more difficult.

The bill would provide for automatic cuts to discretionary spending if Congress does not appropriate below the limits in fiscal 2024 and fiscal 2025. Spending caps continue from 2026 to 2029 but they are enforced only by budget rules, which lawmakers could waive by majority vote.

Another key provision in the bill — championed by Rep. Thomas Massie, R-Ky. — would automatically cut discretionary spending by 1 percent if Congress does not pass all 12 appropriations bills for fiscal 2024 by Jan. 1, 2024. That was a key selling point for Massie, typically a staunch fiscal conservative, to support the debt limit measure, as well as other outspoken conservatives like Rep. Marjorie Taylor Greene, R-Ga.

David Lerman and Aidan Quigley contributed to this report.