U.S. House passes huge debt reduction bill

11:08, July 20, 2011      

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The U.S. House of Representatives passed legislation Tuesday night to cut federal spending by 6 trillion U.S. dollars in exchange for a 2.4 trillion U.S. dollars increase in the nation's borrowing cap.

This tea party-backed plan also requires a constitutional balanced budget amendment. However, President Barack Obama has objected this plan earlier this day, and it also has no chance of passing the Democratic-controlled Senate.

The country's critical debt challenge should be addressed, but needed to be done in a "balanced approach," the president said at a White house briefing. He also warned that there is not much time left as an Aug.2 deadline of debt ceiling closing in.

The U.S. borrowing limit, currently at 14.29 trillion, was reached on May 16 this year. U.S. Treasury Department said the country would default without an agreement to lift the limit by Aug. 2.

Republicans have refused to discuss any debt-reduction deal that includes higher taxes, while Democrats have rejected any deal based solely on spending cuts.

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