WASHINGTON (AP) — It’s a deal no one in Washington says they like very much. But after weeks of negotiations, President Joe Biden and House Speaker Kevin McCarthy have reached an agreement to raise the debt ceiling and avoid a potentially devastating government default.
The stakes are high for both men, and now each will have to persuade lawmakers from their parties to vote for him. Treasury Secretary Janet Yellen said last week that the United States could run out of cash to pay bills and default on its obligations if the debt ceiling is not raised by June 5.
The final deal, hammered out by Biden, McCarthy and a small group of their lawmakers, is a two-year budget deal that would basically keep spending flat through 2024, while increasing it for defense and veterans, and limiting increases to 1% by 2025. It would suspend the debt limit until January 2025, after the next presidential election. Republicans had insisted on cutting spending and passed their own bill with much bigger cuts last month.
The package would also make policy tweaks, including adding work requirements for some food aid recipients and streamlining an environmental law that Republicans say has made it harder to build energy projects.
Conclusion of the agreement and the negotiations that led to it:
McCARTHY’S DELICATE BALANCING ACT
Since McCarthy won the presidency of the House in the January 15th vote, it was clear that the negotiations on the debt ceiling would be his first and perhaps biggest test.
Known more for strategy than policy, McCarthy has faced a challenge that seemed almost insurmountable, with a narrow majority and a sizable group of far-right conservatives sure to oppose anything he negotiated with Biden. And he could still find himself in the middle of a crisis if too many in his caucus revolt when the House votes on the package this week.
Through it all, the Californian has displayed his typical relaxed vibe, projecting confidence about the project and its success. On Sunday, he said he will win over most Republicans on the bill and some Democrats.
At a conference Saturday night, McCarthy said, more than 95 percent of the members of his conference “were overwhelmingly enthusiastic about what they saw.”
But some House Republicans were publicly criticizing the deal, arguing it did too little to reduce the deficit. Rep. Dan Bishop of North Carolina tweeted a vomit emoji, complaining that some Republicans on the call were praising the speaker for getting what he said was “almost zippo in exchange” for raising the tax ceiling. debt
BIDEN’S RETAINING COMMITMENT
For months, Biden and his aides had a mantra: There would be no negotiation on the debt limit. But then he negotiated anyway.
It’s not where Biden, a veteran of the nasty 2011 debt limit battle that saw the nation’s credit rating downgraded for the first time in history, wanted to be. But it was a likely scenario, with a Republican-controlled House that had made clear from the start that it would not increase borrowing authority under a Democratic president without extracting spending restrictions or other policy concessions.
There was no way Biden, who is running for re-election next year, wanted a historic blemish on his watch.
Biden has continued to insist that he was negotiating the budget, not the debt ceiling. But pushed by a reporter on Sunday evening who pointed out that this was precisely what Republicans were seeking in exchange for raising the debt limit, the president appeared to backtrack on his talking point.
“Sure, yeah,” Biden said, laughing slightly. “Can you think of an alternative?”
Now he will have to sell it to House Democrats, who must vote for him in large enough numbers to make up for the Republican defections. Many progressive members of the House have been skeptical of the deal, but remained silent over the weekend as they awaited more details.
But the deal drew early praise from another key Democratic group. The New Democrat Coalition, which has about 100 members, praised Biden for negotiating “a workable, bipartisan solution to end this crisis.”
GOP POLICY LONG WANTED
Republicans were able to win some policy changes they have sought for years, albeit modest ones, including on food aid. The bill would increase the age limit for existing work requirements in the Supplemental Nutrition Assistance Program, also known as food stamps. It would also create a new agency to develop and streamline environmental reviews that Republicans have complained about for decades.
New work requirements for eligible SNAP recipients without dependents would be phased in by 2025 and expire in 2030. And a provision pushed by Biden would eliminate work requirements for some vulnerable recipients, such as veterans and the homeless. But Republicans made it clear that pushing more people to work in exchange for government benefits was a major victory for them, albeit a symbolic majority.
The bill would also amend the National Environmental Policy Act and designate “a single lead agency” to conduct environmental reviews, hoping to streamline the process.
Republicans hoped for a much broader permitting package that would facilitate the construction and development of energy projects. But Louisiana Rep. Garret Graves, a McCarthy ally who was one of the negotiators, said the bill brings “transformational changes to the permitting and environmental review process” for the first time in four decades.
QUIET SENATE, WAITING TO CLOSE
McCarthy has said the House will vote on the package on Wednesday. If approved, it will head to the Democratic-led Senate, where leaders will need to get agreement from all 100 members to speed up the process and avoid a default by next Monday.
The White House briefed Democratic senators on Sunday, and McCarthy briefed Republicans. But most senators remained silent on the deal as they wait for the full text and to see if McCarthy can navigate the House.
Senate Majority Leader Chuck Schumer, D-N.Y., and Senate Republican Leader Mitch McConnell of Kentucky withdrew from the negotiation process early on, saying it should be a negotiation between the White House and McCarthy.
McConnell issued a statement Sunday supporting the legislation, but some in his caucus have criticized it. The two leaders will have to resolve any potential objections over the next week as they seek to gain full support to move quickly on the deal.
“With Republicans like these, who needs Democrats?” Utah Sen. Mike Lee tweeted Saturday, aligning himself with House Republicans who say the deal isn’t conservative enough.
