An "agreement in principle" to raise the US debt ceiling was reached on Saturday between US President Joe Biden and House of Representatives Speaker Kevin McCarthy.

The compromise deal that will keep spending flat for 2024 and impose limits for 2025 in exchange for raising the debt limit for two years, until after the next election, "is an important step forward" and prevents what would have been a catastrophic default, Biden said in a statement.

But the coming days will be a further test for both Biden and McCarthy, both of whom must rally enough support for the agreement within their respective parties to ensure it passes through the House and Senate when it goes to the vote.

Failure to do so would roil the US economy and threaten the financial security of millions of US citizens. Even if the deal does go through, the US people should now be in no doubt that their politicians are ready to hijack the whole nation for their own partisan interests.

Defaulting on its debt obligations would also be an immense embarrassment for the US. As CNN commented, "It is an extraordinary scenario that the rest of the world is wondering whether the US will pay its debts" and defaulting on its debt obligations "would severely dent Washington's claims to reliable global leadership in the long term".

US Treasury Secretary Janet Yellen wrote to Congress on Friday saying that her department would run out of money if Congress does not raise or suspend the debt ceiling by June 5.

Although that extends the deadline from June 1, there is unlikely to be much elasticity left.

Those on Capitol Hill should realize that they do not have the luxury of time to try and score points off the other party if an economic and financial disaster of their own making is to be avoided. The disaster would not only shatter the lives of millions of ordinary Americans and damage the credit rating of the US, but also have an adverse impact on the status of the US dollar as a reserve currency which is a pillar of the US' hegemony that they are so desperate to maintain.

The debt ceiling tussle has become a test of whether there are enough moderates in the two parties to prevent the extremists from causing widespread wrack and ruin.