President Biden and House Speaker Kevin McCarthy have struck a tentative deal to raise the debt ceiling on Saturday night, sources close to the talks have said.
The deal to raise the government’s $31 trillion debt ceiling concludes a months-long stalemate between the White House and House Republicans.
The tentative deal was revealed following a 90-minute phone call between Biden, who is currently at Camp David, and McCarthy, who is in Washington.
Ahead of the deal, treasury Secretary Janet Yellen said Friday afternoon the government won’t run out of money until June 5 — four days later than was previously expected, relieving some pressure amid tense negotiations.
However, McCarthy must give members 72 hours to review a bill’s final language before calling a vote on it – a three-day delay pushing the US alarmingly closer to defaulting on its debt.
The 72-hour rule was one of the concessions that conservative holdouts demanded from McCarthy in January in return for the the speaker’s gavel.
Tuesday, May 30, will be the earliest possible House vote — with votes in the Senate to follow days later.
The two sides have to carefully thread the needle in finding a compromise that can clear the House, with a 222-213 Republican majority, and Senate, with a 51-49 Democratic majority.
Biden, who was spending part of the holiday weekend at Camp David, had been in constant talks multiple times a day with his negotiating team. ]
Before he left the White House Friday he said he was “optimistic” that a deal was imminent.
During the contentious negotiations, Republicans demanded that any deal must cut federal spending in exchange for raising the debt ceiling.
Both Republicans and Democrats said one of the biggest holdups was the GOP’s efforts to expand existing work requirements for people on food stamps and other federal aid programs.
The GOP proposal would save $11 billion over the next decade by raising the maximum age for existing standards that require able-bodied adults who do not live with dependents to work or attend training programs.
Democrats have staunchly opposed the proposal, with the White denouncing it as “cruel and senseless.”
Louisiana Rep. Garret Graves, said Friday there was “not a chance” that Republicans might concede on the work requirements issue.
Failure to raise the borrowing limit would have catastrophic effects on the US and global economy, and raise concerns about the country’s leadership.
Yellen said failure to act by the new date would “cause severe hardship to American families, harm our global leadership position and raise questions about our ability to defend our national security interests.”
The Democratic-held Senate was largely absent during negotiations, leaving the talks to Biden and McCarthy. Senate Majority Leader Chuck Schumer of New York pledged to move quickly to send a compromise package to Biden’s desk.
Both sides failed to reach a deal for week, partly because the Biden administration resisted for months on negotiating with McCarthy, arguing that the country’s full faith and credit should not be used as political leverage.
Conservative members of the House Freedom Caucus were
With Post Wires