Debt limit, budget deals take shape in Congress

27 Oct 2015 | Author: | No comments yet »

Budget deal outlines reached as Boehner lo….

WASHINGTON — The White House and congressional Republicans are closing in on a major bipartisan budget deal that would raise the debt ceiling and increase government spending by more than $110 billion over the next two years.

Republicans in Congress presented a plan negotiated with Democrats to steer the U.S. away from defaulting on its debt next week, putting lawmakers on course to stave off a fiscal calamity. The accord would extend the government’s borrowing authority until March 2017 — eliminating the danger of a default after Nov. 3 — and also include a two-year deal on spending, aides from both parties said. The $112 billion, two-year budget accord would roll back some of the impending sequester cuts to defense and domestic programs and ensure government funding is extended beyond the current Dec. 11 deadline, according to congressional aides familiar with the talks. The spending limits would be increased in 2016 and 2017, with Democrats getting an increase on domestic spending equal to the amount Republicans would add on defense money.

House and Senate Republican leaders presented the plan to members Monday night. “It is a good deal,” said House Rules Committee Chairman Pete Sessions, a Texas Republican. The plan will likely get a vote very soon, as early as Wednesday, so House Speaker John Boehner (R-Ohio) can hand his successor less of a mess to deal with. He said the plan would raise spending caps for defense and non-defense programs for two years, though it would keep discretionary spending below 2008 levels. Lawmakers were briefed on the outlines, and final language was being written Monday night, with the hope of introducing legislation for a House vote Wednesday. Boehner, R-Ohio, who is preparing to step down this week after being forced to retire early by his party’s hard-right flank. “Fiscal negotiations are ongoing,” said Senate Majority Leader Mitch McConnell, R-Ky., as he opened the Senate. “As the details come in, and especially if an agreement is reached, I intend to consult and discuss the details with our colleagues.” After abruptly announcing his retirement last month, Boehner had vowed to “clean up the barn” for his successor.

The agreement wouldn’t eliminate the chance of a government shutdown if lawmakers can’t resolve differences over spending priorities and policy riders by Dec. 11, when current funding expires. The deal also paves the way for another debt holiday, allowing President Obama to borrow as much as he needs to keep the government operating into 2017 — meaning he is likely leave office with the total debt nearing $20 trillion. Paul Ryan (R-Wis.) has locked down most Republicans’ support for his Speaker bid and is likely to win official support from the conference on Tuesday and become Speaker the following day after the full House votes on it.

In exchange, the deal imposes more checks on disability beneficiaries — what backers were calling the biggest changes since the 1980s. “Negotiations are ongoing, but I hope that Democrats and Republicans will come to a resolution soon that is good for our country,” Senate Minority Leader Harry Reid, Nevada Democrat, said as his chamber opened for business Monday afternoon. Those increases would be offset by cuts in spending on Medicare and Social Security disability benefits, as well as savings or revenue from an array of other programs, including changes to the nation’s strategic petroleum reserves.

Government funding levels would be set through the end of the next fiscal year, taking a shutdown threat off of the table for the first year of Ryan’s speakership. If the deal happens, it would represent a significant breakthrough after years of gridlock in Congress, especially on fiscal issues, as each side compromised on a core issue. It also would give Ryan a clean start as speaker and Republicans a reset on trying to convince voters that they can be an effective governing majority.

And when the conservative uproar that’s already bubbling in private spills into the public, Ryan can point to Boehner, who will be on his way out the door or already gone, as the author of the deal. The outgoing speaker promised to “clean the barn” of tough issues before leaving, and the talks were a last chance for him to try to win more entitlement spending cuts. “Regardless of whatever the timing is, the process is flawed. It’s unclear whether Ryan will vote for the agreement, and some of his backers are privately urging him to oppose it, arguing it will help him prove that he is ready to legislate differently.

Freedom Caucus member Raul Labrador of Idaho said Monday he would rather Congress pass a short-term debt-limit measure for now and let Ryan handle the larger package later. The prospective fiscal agreement would solve each of those problems, and theoretically could be one of the last spending fights between President Barack Obama and the Republican-controlled Congress before he leaves office in January 2017. Under the contours of the current talks, the deal probably would be paid for with a combination of budget cuts elsewhere, new fees and relying partly on an overseas contingency fund set aside for military operations. Boehner as speaker. “In Washington ‘cleaning the barn’ is apparently synonymous with shoveling manure on the American people,” said Michael A.

Republicans had suggested tapping that account before to boost military funding, but Democrats and even some Republicans argued it was an accounting gimmick because the fund was not intended to be used for such a purpose. Justin Amash (R-Mich.) argued that candidates for speaker must say where they stand on the accord, and how they feel about the agreement being negotiated behind closed doors. Rank-and-file House Republicans, in particular, have been resistant to authorizing an increase in the debt limit without some accompanying adjustments to mandatory federal spending programs. The deal could settle a number of tricky fiscal issues that have piled up, with the ongoing fight over yearly spending bills the biggest of them — chiefly because of the 2011 debt deal’s automatic “sequester” spending cuts that were due to take tens of billions of dollars out of discretionary spending in fiscal year 2016, which began Oct. 1.

The GOP will score a victory with another provision that would do away with an Affordable Care Act requirement that larger companies automatically sign up workers for health care unless the workers specifically opt out. Monday’s deal calls for a debt holiday until early 2017, or a $1.5 trillion debt level increase that would last about the same length of time, pushing the issue into the next president’s term.

On the spending measure, one proposal would curb a pending 52 percent increase in Medicare Part B premiums that would affect the highest and lowest-income Medicare recipients, said a Republican aide. Those recipients would have a premium increase of about $16 a month, plus a $4 or $5 monthly surcharge, instead of a $54 a month increase, according to the aide. That question was resolved last week when Ryan, the powerful chairman of the Ways and Means Committee and one of his party’s leading voices on fiscal matters, announced that he would seek the speakership provided his colleagues rallied behind him.

Obama’s tenure, total debt is $18.2 trillion, and will likely leap several hundred billion dollars the moment Congress approves a borrowing increase. A bipartisan majority in the House wants to revive the bank and pushed the vote forward with a rare “discharge petition” procedure that hasn’t been fully deployed since the 1970s. While the four congressional leaders and Obama never met face-to-face in this round, aides said that there were frequent phone calls among the individual leaders as talks developed.

Boehner’s resignation, announced on Sept. 25, lent additional urgency to the talks, as it became clear that negotiations could prove far more difficult once a new speaker was in place.

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