WASHINGTON — House Republicans reached a tentative cope with the White House on Saturday night to lift the nation’s borrowing limit and avoid a catastrophic default on U.S. sovereign debt.
“Now we have come to an agreement in principle,” House Speaker Kevin McCarthy said Saturday within the Capitol. “We still have a number of work to do, but I feel that is an agreement in principle that is worthy of the American people.”
McCarthy said he spoke to President Joe Biden twice on Saturday in regards to the plan. “I expect to complete the writing of the bill, checking with the White House and chatting with the president again tomorrow afternoon,” said the California Republican, “Then posting the text of it tomorrow, after which be voting on it on Wednesday.”
The deal, he said, “has historic reductions in spending, consequential reforms that may lift people out of poverty and into the workforce, and rein in government overreach. There aren’t any latest taxes and no latest government programs.”
Biden called the deal “a vital step forward that reduces spending while protecting critical programs for working people and growing the economy for everybody.”
He also offered a preview of the White House’s argument for House Democrats reluctant to support a bill that appears on its face to be a Republican victory: Briefly, it might have been rather a lot worse.
“The agreement protects my and Congressional Democrats’ key priorities and legislative accomplishments,” said Biden, adding that it “represents a compromise, which implies not everyone gets what they need.”
The White House has invited all House Democrats to attend a virtual briefing on Sunday afternoon, presumably to clarify what’s within the deal and urge Democrats to vote for it.
The announcements marked the beginning of a lobbying blitz by House and Senate leaders in each parties to persuade their members to vote for the package, which is able to have to win enough votes within the GOP-controlled House and Democratic-held Senate to lift the U.S. debt ceiling in time to satisfy a June 5 deadline.
A minimum of one senator, Utah Republican Mike Lee, has already threatened to make use of procedural maneuvers within the Senate to carry up a debt ceiling bill for so long as possible if he doesn’t like what it incorporates.
Within the House, a bunch of 35 ultraconservative members publicly pressured McCarthy to demand much more concessions from Democrats and to “hold the road.” They, too, indicated they’d not support a deal that they thought gave an excessive amount of away.
A vote to lift the debt limit doesn’t authorize additional government spending. It merely permits the Treasury to satisfy obligations that were already approved by Congress up to now, a few of them, a long time ago.
Nonetheless, many Republicans have come to view the biennial vote to lift the debt limit as a possibility to extract concessions from Democrats in exchange for his or her votes to avoid a debt default.
This time around was no different. Republicans demanded that the White House comply with a bill that contained, at a minimum, baseline government spending cuts, latest work requirements for public assistance, energy permitting reform and the rescinding of unspent Covid emergency funds.
The ultimate push on the deal took place Saturday, despite updated guidance from the Treasury Department on Friday afternoon which identified June 5 because the debt default deadline.
That’s five days later than the previous Treasury guidance date of June 1. The update was taken by some lawmakers as meaning there could be less pressure on negotiators since the date could slide again.
But that is not how lead GOP negotiator Rep. Patrick McHenry, N.C., read it. Praising Treasury Secretary Janet Yellen as “a girl of principle [who] is faithful to the law,” McHenry told reporters Friday that the brand new date put to rest any lingering questions on when default would occur. “Now we all know, and this puts additional pressure on us to perform,” he said.
Yellen explained that the agency was “scheduled to make an estimated $130 billion of payments and transfers” throughout the first two days of June. This is able to “leave Treasury with an especially low level of resources.”
The week of June 5, Treasury will owe “an estimated $92 billion of payments and transfers,” Yellen wrote in a public letter to House Speaker Kevin McCarthy.
Unless the debt limit were raised in time and the federal government was allowed to borrow more, “Our projected resources could be inadequate to satisfy all of those obligations.”
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