The White House and congressional Democrats are nearing a deal to raise the debt ceiling for two years and fund the government, CNBC, the Wall St Street Journal and other sources are reporting today.
The deal would suspend the debt ceiling limit for two years and put a permanent end to the budget sequester rules that automatically cut government spending absent a budget. Those cuts were scheduled to go into effect in January.
And all this before Congress leaves for its August recess.
As reported by CNBC, for example, the budget agreement would include parity between increases in defense and domestic non-defense spending, a priority for Democratic House Speaker Nancy Pelosi. It would also include about $75 billion in spending offsets supported by conservative Republicans. The deal sets spending about $320 billion above the levels in the sequester for fiscal year 2020 (which begins in October) and fiscal 2021.
Not all conservatives are okay with that level of spending and it is not clear if President Donald Trump and the spending cut hawks in the White House support the deal.
Treasury Secretary Steve Mnuchin has warned that the United States could run out of cash to pay its bills by September without an increase in the debt ceiling.
In addition there’s the danger of a government shutdown if Congress can’t pass a spending bill by September 30.
House Speaker Pelosi has said she hopes to bring a budget deal to the House floor by Thursday, the last day the House is in session before its August recess. If the House manages to pass a budget on that schedule, the Senate would have time, theoretically, to pass a bill before it goes on recess next week.