President Joe Biden and House Speaker Kevin McCarthy reached an “agreement in principle” Saturday afternoon as they raced to reach an agreement to limit federal spending and resolve the looming debt crisis before of the June 5 deadline.
Speaking to reporters Saturday night, McCarthy said “we still have a lot of work to do,” but added that he believes “it’s an agreement in principle that is worthy of the American people.”
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President Joe Biden and House Speaker Kevin McCarthy have reached an “agreement in principle” to resolve the looming debt crisis.
Sources told The Associated Press that they reached an agreement on a 2-year budget and debt limit increase that include enhanced work requirements for food aid. McCarthy said his intention is to release the legislative text on Sunday, with a vote scheduled for Wednesday. outline of a deal, a legislative package can be drafted in time for congressional votes next week before a federal default expected on June 5
“It has historic spending reductions, consequential reforms that will lift people out of poverty and into the workforce, curbing government overreach,” he continued. “No new taxes, no new government programs.”
The two sides reached an agreement on a 2-year budget and debt limit increase that include improved work requirements for food aid.
“There’s a lot more to the bill. We still have more work to do tonight to finish drafting it,” McCarthy said before thanking his two top GOP negotiatorsReps. Garret Graves, R-La., and Patrick McHenry, RN.C., for their work in reaching this agreement.
In a statement Saturday night, Biden called the deal “an important step forward that cuts spending while protecting critical programs for working people and growing the economy for everyone,” adding that it also “protects the key priorities and legislative accomplishments of me and the Democrats in Congress.” “
“The agreement represents a compromise, which means that not everyone gets what they want,” the president stressed. “This is the responsibility of governing.”
“This deal is good news for the American people because it averts what could have been a catastrophic default that would have led to an economic recession, devastated retirement accounts and the loss of millions of jobs,” Biden added. , before urging both houses of Congress. “approve the deal immediately.”
With the outlines of a deal in place, the legislative package could be drafted and shared with lawmakers in time for votes early next week in the House and later in the Senate. McCarthy said his intention is to release the legislative text on Sunday, with a vote scheduled for Wednesday.
“I expect to finish writing the bill, consult with the White House and talk to the president again tomorrow afternoon, and then release the text tomorrow, and then vote on it on Wednesday,” McCarthy said Saturday.
A deal would avoid a catastrophic US default, but risks angering both the Democratic and Republican sides of the aisle with concessions made to achieve it.
The centerpiece of the package is a two-year budget deal that would keep spending flat through 2024 and increase it by 1 percent through 2025 in exchange for raising the debt limit for two years, boosting the volatile political issue beyond the next presidential election.
By driving hard for a deal to impose tougher work requirements on government aid recipients, Republicans got some, but not all, of what they wanted. The deal would raise the age of existing work requirements for childless adults from 49 to 54, but Biden was able to get exemptions for veterans and the homeless.
The two sides had also secured an ambitious overhaul of federal permits to facilitate the development of energy projects. Instead, the deal would put in place changes to the National Environmental Policy Act of the 1970s that would designate “a single lead agency” to conduct environmental reviews, hoping to streamline the process.
The deal came a day after Treasury Secretary Janet Yellen told Congress that the U.S. could non-payment of their debt obligations before June 5 — four days later than previously estimated, giving both sides some extra time as they scramble for a deal.
“We have learned from past debt limits that waiting until the last minute to suspend or raise the debt limit can cause serious damage to business and consumer confidence, raise the costs of short-term borrowing to to taxpayers and adversely affect the credit rating of the United States. States,” Yellen wrote. “Indeed, we have already seen Treasury borrowing costs rise substantially for securities maturing in early June.
“If Congress does not raise the debt limit, it would cause severe hardship for American families, harm our global leadership position, and raise questions about our ability to defend our national security interests,” he added.
McCarthy commands only a small Republican majority in the House, driven by far-right conservatives who may resist any deal as inadequate as it tries to cut spending. But by compromising with Democrats for votes, he risks losing the support of his own base, creating a difficult race for the new speaker.
Both parties have suggested that one of the main attractions was a GOP effort to expand work requirements for recipients of food stamps and other federal aid programs, a longtime Republican goal that Democrats have resisted. have vigorously opposed. The White House said the Republican proposals were “cruel and senseless.”
Biden has said there would be no work requirements for Medicaid to begin with. He appeared potentially open to negotiating changes to food stamps, now known as the Supplemental Nutrition Assistance Program, or SNAP, despite objections from rank-and-file Democrats.
Any deal would have to be a political compromise in a divided Congress. Many Trump-aligned Republicans in Congress have long been skeptical of the Treasury projections and are pressing McCarthy to hold off.
Lawmakers are not expected to return to work from Memorial Day weekend until Tuesday at the earliest, and McCarthy has promised lawmakers that he will abide by the 72-hour rule to release any bill before to vote
