Washington: US Senate leaders announced a deal Wednesday to resolve the budget and debt ceiling impasse that threatened to force the country to default on its obligations.
The two houses of Congress still needed to vote on the deal, but signs were that it had enough support to go through, ending the weeks-long standoff and reopening the government.
But the same issues -- funding the government and raising the debt ceiling again -- could come back in January and February, unless Democrats and Republicans agree before then on a long-term program to cut the deficit.
Here are the main components of the deal:
+ Establishes a fresh short-term budget for fiscal 2014, which began on October 1, that allows all parts of the government to reopen. But the "continuing resolution" would cover only October 1-January 15, when a new budget or CR would have to be passed.
+ Sets the stage for negotiations between Democratic and Republican legislators on a long-term plan on taxes and spending, aimed at trimming the fiscal deficit while replacing $20 billion in additional automatic"sequester" spending cuts programmed to come into effect in January. Those cuts, many fear, would further hold back economic growth and overly hamper the military.
+ Lifts the $16.7 trillion borrowing ceiling, allowing the Treasury to issue more debt to finance its deficit, which averages about $60 billion a month. But the ceiling would be locked again on February 7, raising a new challenge to the government.
First Published: Wednesday, October 16, 2013, 23:29