Party leaders racing to seal budget deal

congress

Congress and the White House hope to reach an agreement with surprising speed.

Congressional leaders and top Trump administration officials began working quickly Tuesday to cut a two-year budget deal to avoid blunt spending cuts and a potential debt default, a surprisingly positive development amid unending gridlock.

President Donald Trump dispatched Treasury Secretary Steven Mnuchin, acting White House Chief of Staff Mick Mulvaney and acting budget chief Russ Vought to meet with top House and Senate leaders on Tuesday morning. The discussions lasted more than two hours, which was itself notable, and Mulvaney said the leaders will meet again on Tuesday afternoon.

Story Continued Below

“We have some differences, but there’s good progress being made,” said Senate Minority Leader Chuck Schumer of New York. “We have certain domestic needs that are very important to us. And they have — look, we’re trying to come to an agreement.”

Senate Majority Leader Mitch McConnell (R-Ky.) called the meeting “very encouraging” and said his hope was to clinch the deal by the end of the day.

“My perception is everyone would like this,” McConnell said on Tuesday afternoon after a party lunch with Vice President Mike Pence.

Congressional leaders are all eager to avoid a series of automatic spending cuts known as sequestration that will take place without a new budget deal. While Schumer and Speaker Nancy Pelosi (D-Calif.) want to stop $55 billion in potential domestic spending cuts, McConnell and House Minority Leader Kevin McCarthy (R-Calif.) are worried about $71 billion in defense cuts.

Mulvaney and Vought have generally been fiscal hard-liners, but Mnuchin has been deputized to lead the negotiations with the congressional leaders, much to the delight of the Hill honchos. Mnuchin appeared to be trying to clinch a deal on Tuesday, a sign of how urgent the discussions are, said one source familiar with the meeting.

Mulvaney declined to characterize the meeting: “I’m not going to talk about that.”

Lifting the debt ceiling is also under discussion but is not viewed as integral to a spending deal. The debt limit can likely wait until later in the fall before requiring congressional action. Schumer said the debt ceiling could be part of an overall deal but was not being discussed on Tuesday.

In addition to stopping the spending cuts, most lawmakers want a budget deal to take a shutdown off the table. The 35-day partial shutdown over Trump’s border wall was debilitating for the GOP, and Republicans want to do everything they can to avoid another one.

A two-year budget deal would set a spending target that allows the Appropriations committees in each chamber to devise spending bills before the Sept. 30 government funding deadline. Without that number, lawmakers risk throwing together a catch-all bill this fall that raises the prospect of brinkmanship.

Senate Appropriations Chairman Richard Shelby (R-Ala.) is hoping to get a deal by June to allow his panel to make progress on the 12 annual spending bills. Despite the shutdown, Congress was able to fund about three-quarters of the government through the regular spending process, the strongest showing in years.

“I’d be happy to see a one-year deal. I’d love to see a two-year agreement,” said Sen. Roy Blunt (R-Mo.). “If we go much longer [without a deal], we almost certainly won’t be able to do the [spending] work in the open way we did last year. And the final product will suffer.”