After weeks of tedious and sometimes repetitive debates between Republicans and Democrats, Washington leaders have passed an agreement on the debt ceiling. While most specifics are still unknown, a few key details have been released.
In short, the debt ceiling will be raised to $2.4 trillion while spending cuts will be implemented to balance the budget. The goal is to reduce the deficit by the same amount ($2.4 trillion) that the ceiling was raised over the next 10 years, according to BBC.
A new bipartisan congressional committee will be launched to handle the "especially hot potatoes" that are expected to emerge in the coming months, reports USA Today. Tax increases and changes to Social Security, Medicare and other entitlement programs will be handled by the committee as well.
House Speaker John Boehner announced that the savings from the agreement would amount to $1.5 trillion.
Despite passage of the bill, there is still a possibility that the U.S. will lose its AAA credit rating from agency Standard & Poor's, according to The Guardian. The organization said that there would have to be spending cuts around $4 trillion to preserve the rating.
"Avoiding the worst case scenario of a default on US Treasury obligations will not prevent a downgrade of the triple-A sovereign rating," Kevin Daly, emerging market debt portfolio manager at Aberdeen Asset Management, told the publication. "So it's time for us all to figure out just what it means when the U.S. gets downgraded."
Still, some have seen the deal as a victory for President Obama – especially when it comes to the 2012 elections.
"Mr. Obama succeeded in showing leadership in the end by brokering any deal to solve the crisis, showed he was willing to compromise and take less than he wanted, and showed he was serious about tackling the looming debt crisis facing the country," writes Robert Hendin for CBS News.
On the other side of the aisle, commentators have hailed the bill as "a tea party triumph" in The Wall Street Journal.