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A crunch deal to raise the US debt ceiling has been voted through by the House of Representatives.

The agreement – which aims to avert a potentially catastrophic scenario where the US defaults on its national debts – passed through the Republican-majority House by 314 to 117 votes.

The proposal will now move to the Senate. The Senate’s majority leader, Chuck Schumer, has vowed to move quickly to pass the bill.

It needs to be on President Joe Biden’s desk by Monday’s deadline – the point at which the US federal government is expected to run out of money to pay its bills.

“This agreement is good news for the American people and the American economy,” Mr Biden said after the vote.

“I urge the Senate to pass it as quickly as possible so that I can sign it into law.”

House Speaker Kevin McCarthy and President Joe Biden have reportedly reached a "tentative deal" on raising the US debt ceiling
Image:
The deal comes after an agreement was reached between Republican Mr McCarthy and Democrat president, Joe Biden

What is the debt limit – and why does it matter?

The main aim of the deal is to increase the US debt limit from $31.4trn (£25.3trn) – which it achieves by suspending the borrowing limit until January 2025 rather than setting a new level.

It also averts a situation where the US defaults on its national debts – a scenario that would have huge impacts both for the US and the wider world economy.

US Treasury secretary Janet Yellen previously warned that without a deal to suspend the debt ceiling, the US would not have enough money to meet all of its financial obligations by 5 June.

That would mean civil servant wages, social welfare payments, and health insurance would go unpaid.

Read more:
US debt ceiling: What is it and how devastating would a default be?

Crisis gets kicked down the road – but is a ‘moment of reckoning’ to come?

American politics has a strange ability to create a sort of manufactured jeopardy, which then has the prospect of becoming a self-fulfilling prophecy.

Few really believe that the country’s politicians will actually allow the nation to default for the first time in its history.

But this game of chicken is going to the wire – both sides unwilling to move, even to negotiate, until the last minute to eke out concessions.

And to be clear, it is a game which can go wrong – and if a default did happen, it would be a global crisis.

The vote overnight, for the deal – to raise the debt ceiling – means the crisis is a little closer to being avoided.

Congressmen and women found consensus in a deeply divided house to vote for the deal which had been hammered out by President Biden and his political foe, House speaker Kevin McCarthy, over the past few days. It passed 314 to 117.

But in their pre-vote speeches, it was clear that many, many politicians have deep reservations about the level of unsustainable debt.

Yes, they were relieved that the deal allows bills to be paid, it protects the country’s credit rating, medical care is protected as is social security.

But, “a moment of reckoning is coming”, one Republican warned. Another said the level of debt is “totally unsustainable and irresponsible”.

Some Republicans celebrated concessions they got, which will impose spending caps and place checks and balances on the executive branch of government.

But the consensus was that it wasn’t perfect or even good for anyone. But that’s the price of such divided politics.

The bill now heads to senators. They may want amendments, but are likely to pass it. Crisis is then averted. This game of chicken over. Debt ceiling raised. Can kicked down the road.

If the US no longer pays interest on its bonds – IOUs it issued to raise funds – it would default on debt payments and its credit rating would fall.

A vital way the country raises money – selling bonds – would also be at risk due to the insecurity will markets would charge more to lend to the US.

Economists warn that a prolonged period where the US cannot pay its bills would lead to a nearly 20% drop in stock prices – and an economic contraction of up to 4%.

Bipartisan deal

Wednesday’s vote comes after Mr Biden and leader of the House of Representatives, speaker Kevin McCarthy, reached an agreement over the country’s debt ceiling.

In order to secure the agreement, the Democrats were forced to make concessions to the typically pro-small-state Republicans, including spending cuts and policy concessions.

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In a speech before the vote, Mr McCarthy praised the bill’s budget cuts, which he said were needed to curb Washington’s “runaway spending”.

Despite his praise of the deal, it drew opposition from 71 hardline Republicans. That would normally be enough to block partisan legislation, but 165 Democrats backed the measure and pushed it through.

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LA fires: Data and videos reveal scale of ‘most destructive’ blazes in modern US history

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LA fires: Data and videos reveal scale of 'most destructive' blazes in modern US history

The fires that have been raging in Los Angeles County this week may be the “most destructive” in modern US history.

In just three days, the blazes have covered tens of thousands of acres of land and could potentially have an economic impact of up to $150bn (£123bn), according to private forecaster Accuweather.

Sky News has used a combination of open-source techniques, data analysis, satellite imagery and social media footage to analyse how and why the fires started, and work out the estimated economic and environmental cost.

More than 1,000 structures have been damaged so far, local officials have estimated. The real figure is likely to be much higher.

“In fact, it’s likely that perhaps 15,000 or even more structures have been destroyed,” said Jonathan Porter, chief meteorologist at Accuweather.

These include some of the country’s most expensive real estate, as well as critical infrastructure.

Beachfront properties are left destroyed by the Palisades Fire, Thursday, Jan. 9, 2025 in Malibu, Calif. (AP Photo/Mark J. Terrill)
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Beachfront properties in Malibu were destroyed by the Palisades fire. Pic: PA

Accuweather has estimated the fires could have a total damage and economic loss of between $135bn and $150bn.

“It’s clear this is going to be the most destructive wildfire in California history, and likely the most destructive wildfire in modern US history,” said Mr Porter.

“That is our estimate based upon what has occurred thus far, plus some considerations for the near-term impacts of the fires,” he added.

The calculations were made using a wide variety of data inputs, from property damage and evacuation efforts, to the longer-term negative impacts from job and wage losses as well as a decline in tourism to the area.

The Palisades fire, which has burned at least 20,000 acres of land, has been the biggest so far.

Sentinel
Sentinel satellite imagery of the Pacific Palisades from space, taken around 15 minutes after the Palisades Fire was first reported. The red indicates the area of land that had already burned. Pic: Sentinel Hub
Image:
Sentinel satellite imagery of the Pacific Palisades from space, taken around 15 minutes after the Palisades fire was first reported. The red indicates the area of land that had already burned. Pic: Sentinel Hub

Satellite imagery and social media videos indicate the fire was first visible in the area around Skull Rock, part of a 4.5 mile hiking trail, northeast of the upscale Pacific Palisades neighbourhood.

These videos were taken by hikers on the route at around 10.30am on Tuesday 7 January, when the fire began spreading.

At about the same time, this footage of a plane landing at Los Angeles International Airport was captured. A growing cloud of smoke is visible in the hills in the background – the same area where the hikers filmed their videos.

The area’s high winds and dry weather accelerated the speed that the fire has spread. By Tuesday night, Eaton fire sparked in a forested area north of downtown LA, and Hurst fire broke out in Sylmar, a suburban neighbourhood north of San Fernando, after a brush fire.

These images from NASA’s Black Marble tool that detects light sources on the ground show how much the Palisades and Eaton fires grew in less than 24 hours.

 

On Tuesday, the Palisades fire had covered 772 acres. At the time of publication of Friday, the fire had grown to cover nearly 20,500 acres, some 26.5 times its initial size.

The Palisades fire was the first to spark, but others erupted over the following days.

At around 1pm on Wednesday afternoon, the Lidia fire was first reported in Acton, next to the Angeles National Forest north of LA. Smaller than the others, firefighters managed to contain the blaze by 75% on Friday.

Fires map

On Thursday, the Kenneth fire was reported at 2.40pm local time, according to Ventura County Fire Department, near a place called Victory Trailhead at the border of Ventura and Los Angeles counties.

This footage from a fire-monitoring camera in Simi Valley shows plumes of smoke billowing from the Kenneth fire.

Sky News analysed infrared satellite imagery to show how these fires grew all across LA.

The largest fires are still far from being contained, and have prompted thousands of residents to flee their homes as officials continued to keep large areas under evacuation orders. It’s unclear when they’ll be able to return.

“This is a tremendous loss that is going to result in many people and businesses needing a lot of help, as they begin the very slow process of putting their lives back together and rebuilding,” said Mr Porter.

“This is going to be an event that is going to likely take some people and businesses, perhaps a decade to recover from this fully.”


The Data and Forensics team is a multi-skilled unit dedicated to providing transparent journalism from Sky News. We gather, analyse and visualise data to tell data-driven stories. We combine traditional reporting skills with advanced analysis of satellite images, social media and other open source information. Through multimedia storytelling we aim to better explain the world while also showing how our journalism is done.

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They are hurting but managing to find hope in ‘tomorrow’ – the residents who have lost everything in the LA fires

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They are hurting but managing to find hope in 'tomorrow' - the residents who have lost everything in the LA fires

They are the displaced and there are tens of thousands of them, 600 in an evacuation centre we visited.

From elderly people who fled without their medication, to pregnant mothers desperate to escape the smoke, they had nowhere else to go.

Jim Mayfield, who has lived in the northern suburb of Altadena for 50 years, wept as he told me his dogs, Monkey and Coca, were all he had left.

He said: “The fire was coming down, a ball of fire, it hadn’t made it to my house, but then I woke up and I seen it so I had to start evacuating.

“I had to grab my dogs, I didn’t have enough water and my house is burned down to the ground.”

Thousands of buildings have been burned to the ground
Image:
Thousands of buildings have been burned to the ground since the fires in Los Angeles started

Sheila Kraetzel, another elderly resident, relived the sense of terror as homes were engulfed by the flames.

She said: “I smelt smoke, I was sleeping, and my dog alerted me that there was trouble.

More on California Wildfires

“When I looked outside, there were embers floating across my yard.

“My whole neighbourhood is gone.”

“It was a beautiful, unique place,” she added, smiling.

Thousands of firefighters have been working around the clock to contain the wind-driven fires in California
Image:
Firefighters have been working around the clock to contain the wind-driven fires

Asked how she could smile, she fought back tears and replied: “Well, there’s tomorrow you know.”

How anyone could find hope amid the destruction we have witnessed here is beyond me.

Read more:
Scale of ‘most destructive’ blazes in modern US history
In pictures: Before and after the blazes
What caused the fires?

There are people handing out food and water, medical staff doing what they can. Volunteers have rallied from far and near.

Buildings destroyed in fires

One of them, Stephanie Porter, told me it felt “heavy” inside the centre.

“You walk through and see the despair on people’s faces, not knowing what their next step is, not knowing if their house is still standing,” she said.

“I had to take a few moments… and kind of cry, and then you go back to serve.

“It just breaks your heart.”

Three miles up the road, Altadena resembles a war zone, but residents have not been allowed to return.

When they finally do, they’ll discover there’s nothing left of the material lives they left behind.

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Crackdown on looting in burnt-out areas as fires continue to burn in LA

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Crackdown on looting in burnt-out areas as fires continue to burn in LA

Authorities in California have vowed to arrest anybody caught looting in burnt-out neighbourhoods, with one official warning: “We are not screwing around with this.”

Five separate wildfires continue to burn across Los Angeles County, including the Pacific Palisades blaze – which has torn through more than 20,000 acres of land and destroyed an estimated 5,000 structures.

Los Angeles sheriff Robert Luna said a curfew enforced overnight on Thursday would start again at 6pm local time on Friday (2am on Saturday, UK time).

LA fires updates:
Wildfires burn for fourth day killing at least 10

The curfew – which forbids anyone from entering mandatory evacuation areas between 6pm and 6am – was brought in after officers arrested several people for looting in the burned areas. It will be “strictly enforced”, Sheriff Luna added.

“We’re not screwing around with this, we don’t want people taking advantage of our residents that have already been victimised,” he said at a press conference.

The punishment for looting is a $1,000 fine and even potential jail time.

Fire crews battle the Kenneth Fire in the West Hills section of Los Angeles, Thursday, Jan. 9, 2025. (AP Photo/Ethan Swope)
Image:
Fire crews battling the Kenneth Fire overnight. Pic: AP

National Guards stand near the damaged structures burned from the Eaton Fire in Altadena, California, U.S., January 10, 2025. REUTERS/Ringo Chiu
Image:
National Guards stand near the structures burned by the Eaton Fire. Pic: Reuters

The National Guard has been deployed to help secure areas affected by the fires. They are helping to manage restriction zone checkpoints and prevent looting.

Pacific Palisades, which has borne the brunt of the destruction, is an exclusive neighbourhood loved by celebrities – many of whom have seen their homes completely burnt out.

Paris Hilton’s house in the nearby Malibu has also been destroyed, along with a number of other beachfront properties.

A staircase is left partially standing in a property in the aftermath of the Palisades Fire in the Pacific Palisades neighborhood of Los Angeles, Friday, Jan. 10, 2025. (AP Photo/John Locher)
Image:
A staircase is all that’s left partially standing in a Palisades property after fires ripped through the area. Pic: AP

Beach front properties are left destroyed by the Palisades fire.
Pic: AP
Image:
Beachside buildings destroyed by the Palisades fire. Pic: AP

Authorities are cracking down on illegal drone usage in fire traffic areas after a fire-fighting ‘super scooper’ plane was grounded due to being damaged by a drone.

They are continuing to investigate what caused the fires. A suspected arsonist was arrested near the Kenneth fire on Thursday afternoon local time.

The officials’ warning to looters came as 153,000 people remain under evacuation orders. While the fires are still burning, some evacuated residents have been able to make brief trips to their neighbourhoods – where many have discovered their homes reduced to ashes.

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LA residents weep as they return to burned homes

Authorities have also confirmed at least 10 people have been killed.

Among them was Rodney Nickerson, an 82-year-old who decided to stay in his home in Altadena, a suburb north of Los Angeles.

His daughter Kimiko Nickerson told Sky News: “He just didn’t want to evacuate. He’s been living here since 1968, and he’s been in Altadena my whole life.

“Like all of us on this block, in four blocks, he didn’t think it was going to be this devastating.”

Read more:
In pictures: Before and after the blazes
What caused the fires?
Furious woman challenges LA governor

The Palisades blaze – the biggest of the five – is just 8% contained, while the Kenneth fire, which threatens another celebrity-loved neighbourhood, Calabasas, has burnt through 1,000 acres and is 35% contained.

At least 10,000 structures, including thousands of homes, have been destroyed across the region.

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