Washington, Jul 23: US President Donald Trump announced on Monday that the White House and Congressional leaders reached a tentative two-year budget deal that would raise spending limits by dollar 320 billion and suspend the debt limit until mid-2021.
"I am pleased to announce that a deal has been struck with Senate Majority Leader Mitch McConnell, Senate Minority Leader Chuck Schumer, Speaker of the House Nancy Pelosi, and House Minority Leader Kevin McCarthy - on a two-year Budget and Debt Ceiling," Trump tweeted, calling the agreement "a real compromise in order to give another big victory to our Great Military and Vets!"
According to the Wall Street Journal, the deal will increase spending by dollar 320 billion above the limits set in 2011, which is dollar 30 billion less than the Democrats wanted but only half the dollar 150 billion in savings Trump hoped for.
The deal also will suspend the federal debt ceiling until July 31, 2021. The current debt ceiling expired on March 1, when the debt ballooned to over 22 trillion dollars. The Treasury Department has taken a series of "extraordinary measures" to prevent the nation from defaulting on its payment obligations.
House Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer released a joint statement said the House will now move swiftly to bring the budget caps and debt ceiling agreement legislation to the floor in order to send to Trump’s desk. The agreement will allow the parties involved to avoid sequestration, the leaders added.
"We must never let the full faith and credit of the United States come under threat, and therefore are proud to have achieved a suspension of the debt limit until July 31, 2021. After a long negotiation, we have only agreed upon offsets that were part of an earlier bipartisan agreement," the Democratic leaders said.
The agreement marks a significant retreat for the White House, which insisted just a few months ago that it would force Congress to cut spending on a variety of programs to enact fiscal discipline. Instead, the White House agreed to raise spending for most agencies, particularly at the Pentagon.
In exchange, White House officials received verbal assurances from Democrats that they would not seek to attach controversial policy changes to future spending bills, although it’s unclear how that commitment would be enforced. (UNI)