U.S. President Joe Biden and top congressional Republican Kevin McCarthy have reached a deal to raise the federal government’s $31.4 trillion debt ceiling, ending a months-long stalemate.
The deal would avert an economically destabilizing default, so long as they succeed in passing it through the narrowly divided Congress before the Treasury Department runs short of money to cover all its obligations, which it warned Friday will occur if the debt ceiling is not raised by June 5.
House Speaker Kevin McCarthy came out of negotiations to address the press on Saturday night at 9:15pm.
‘We have reached agreement in principle – a deal worthy of the American people to lift people out of poverty with no new taxes or government overreach programs,’ McCarthy explained.
‘I expect to finish the writing of the bill and then post the text of it tomorrow for it to be voted upon on Wednesday,’ he said without taking any questions from reporters.
‘Big, thorny issues remain,’ one of the top negotiators, Rep. Patrick McHenry, R-N.C., told reporters in the evening. Some of those outstanding issues, McHenry said then, ‘the president and speaker have to resolve at that level.’
President Biden also released a statement late on Saturday night.
‘Earlier this evening, Speaker McCarthy and I reached a budget agreement in principle. It is an important step forward that reduces spending while protecting critical programs for working people and growing the economy for everyone.
‘And, the agreement protects my and Congressional Democrats’ key priorities and legislative accomplishments,’ Biden said.
‘The agreement represents a compromise, which means not everyone gets what they want. That’s the responsibility of governing. And, this agreement is good news for the American people, because it prevents what could have been a catastrophic default and would have led to an economic recession, retirement accounts devastated, and millions of jobs lost.
‘Over the next day, our negotiating teams will finalize legislative text and the agreement will go to the United States House and Senate. I strongly urge both chambers to pass the agreement right away,’ the president said.
McCarthy also tweeted on Saturday evening in which he couldn’t resit a dig at Biden: ‘I just got off the phone with the president a bit ago. After he wasted time and refused to negotiate for months, we’ve come to an agreement in principle that is worthy of the American people.’
Republicans who control the House of Representatives have pushed for steep cuts to spending and other conditions, including new work requirements on some benefit programs for low-income Americans and for funds to be stripped from the Internal Revenue Service, the U.S. tax agency.
The GOP later held a members call at 9:30pm after McCarthy and Biden spoke on the phone earlier in the night for about 90 minutes, according to sources familiar with the negotiations.
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 once a deal is reached, he will give legislators 72 hours before bringing the bill to a vote. He noted on Saturday morning that the bill would not be lengthy, likely around 150 pages.
The dreaded June 5 deadline is four days later than a previous X-date, but still guarantees that – even with a deal this weekend – it will be a frantic race to get a bill through Congress in less than 10 days.