US President Joe Biden speaks from the White House’s Oval Office on June 2 (Photo: Reuters)

“Passing this budget agreement was critical. The stakes could not have been higher,” Biden said. “If we had failed to reach an agreement on the budget, there were extreme voices threatening to take America, for the first time in our 247-year history, into default on our national debt. Nothing, nothing would have been more irresponsible. Nothing would have been more catastrophic. Our economy would have been thrown in recession.”

The US Senate on Thursday passed bipartisan legislation backed by President Joe Biden that lifts the government's 31.4 trillion USD debt ceiling, averting what would have been a first-ever default.