Biden agrees to "historic reductions in spending" to raise the debt ceiling

https://www.cnbc.com/2023/05/27/whi...ach-a-tentative-deal-to-avoid-us-default.html

More details will be coming out soon, but it looks like Biden has finally come to his senses and realized he has been far too radical, and this is a losing issue for Democrats. Even as we got closer to default, most Americans, including independents, wanted to include budget cuts in the debt ceiling bill. They believed that as we got closer to the deadline, they would pick up support to pass a bill without cuts in fear of default. It looks like Biden wanted the debt ceiling increase to last beyond the next election knowing this was a losing issue for Democrats. Republicans wanted cuts in spending and work requirements for people on welfare if they are within a healthy age range and have no dependents.

The key issues that have been debated:

1. Budget cuts: Republicans want to slow government spending. Biden initially said there wasn't a single dollar that could be cut from our federal budget.
2. Rescinding unspent covid funds: There are billions in unspent covid funds that Republicans want to zero out now that the pandemic has officially ended and we haven't been able to figure out how to use the budgeted funds.
3. New work requirements for government assistance: Republicans wanted to make it so that if you're an adult under 55 with no dependents, you can receive three months of government assistance in a three-year period before you have to get a job or enroll in a work assistance program. Republicans do not believe in borrowing money from China to pay able-bodied Americans to sit at home and do nothing.
4. Energy reforms: The Biden administration has been crushing our energy sector with the goal of crippling them forcing us to lose American jobs while acquiring our energy from our enemies who produce the energy in ways that are far worse for the environment.

The problem Biden ran into is that these are all reasonable reforms that moderate Republicans would agree to. Republicans are forcing his hand by not asking for things that have mainstream support. Not agreeing to these terms makes Biden and Democrats seem too radical and extreme.

 

GOOD: Breaking: McCarthy gets debt-ceiling deal — with work requirements.

“Utterly predictable, although it still came about 24 hours later than I expected. On a holiday weekend when people are paying the least attention, Joe Biden finally cut a deal with Kevin McCarthy to raise the debt ceiling and end a game of chicken that Biden and Democrats lost months ago. House Republicans didn’t get everything they wanted, but Biden and the Democrats didn’t get anything they wanted except to limit the embarrassment.”

These tiny cuts don't strike me as 'historic', but, I don't wish to quibble over a win. If we want further sanity in budgeting, we need to win the upcoming election, again.

 

It is interesting seeing how big of a loss this is for the so-called "clean debt ceiling" crowd. They had an indefensible position, but they were hoping Republicans couldn't get their act together. When McCarthy passed a reasonable bill in the House their hands were tied. They were shown to be the ones holding our economy hostage for no reason other than their desire to ignore problems that Americans wanted Congress to work on. The extremists lost here. The grownups in Congress won, and the children will likely cry while their hand is forced. It will be interesting to see how many people from each party vote against it. There are some Republicans who are upset that it didn't go far enough. And, there are some Democrats who will stage crying photo ops in white pantsuits at the thought of cutting a single dollar of federal funding.

 

If enough Republicans will not go along, will a few Dems cross over to save the plan Biden agreed to, to avoid a shut down?

 

We shouldn't fear the government shutting down. In these troubled times less government may be just what the doctor ordered.

 

I agree to some extent. I think Congress should pass rules on how spending is to be prioritized during shutdowns.

 

Spin it....interesting OP headline since it doesn't match the linked article.....man the far RW sure are eager to be guillible and claim wins. All governance should move to the middle, compomise is representative of the people.

 

Biden gets a big win if the deal goes through. He went from I will never negotiate to negotiating at the last minute. Now let's hope he can get enough support from his own party to pass it.

 

Yeah, I'm not sure that this will pass the House without some Democrat votes. I think the smarter move would be for McCarthy to point out that while they have a passed plan, that the Dem in the Senate have passed nothing, and that if this is the deal they want, then they need to pass it through the Senate, and then they'll marry the bills in reconciliation.



We've gone from $34,000 in Federal debt per American at the beginning of Obama/Biden to $88,000 per American halfway through Biden/Kackles. And this doesn't seem to do much to fix that. I'm not sure that Biden's deal can pass the House without Dem votes, and I don't know that Biden can deliver any Dem votes in the House.

McCarthy's best bet might be to point out that they have a passed plan, and now it's time for the Dems in the Senate to demonstrate that they can pass Biden's plan. And then see what the two Houses can do in reconciliation. It seems like Chuckles Schumer has vanished from the face of the planet.

 

Initial estimate that I read was that they were expecting 40ish of the GOP to vote against it.

 

So, they need 43 Democrats? Do you think Dems will deliver them?

 

You conveniently forgot that Trump in FOUR years added a THIRD of the current debt. Shameful...

 

If the dems want Biden to have any shot of being re-elected they better, If 75%+ of the dems don't vote for it, that is a complete condemnation of their alleged "leader"

 

Well, if this bloc votes for it, passing the house should be a non-issue

Key bloc of House Democrats signals support for debt limit deal (msn.com)

 

If McCarthy thinks they will leave him hanging and that he cannot pass this, he should hang tight and insist that the Senate pass it first. It's of no value if the Senate won't pass it, so, let Biden demonstrate that he has Dem support for his position.

McCarthy has demonstrated that the House has support for his initial position, the Dems have demonstrated nothing.

 

If the Senate won't pass a bill that Biden personally negotiated and says he wants to sign, the Democrats will be 100% responsible for a government shutdown as long as a majority of Republicans support it.

They'll whip the votes to get enough, but I'm sure a good number won't vote. I would imagine few would vote against it outside the Congressional Black Caucus and some radicals who have already drawn a hard line against any budget cuts and/or work requirements. Not voting makes more sense for the majority who oppose it. But, time will tell. Politicians don't always do the logical thing.

 

Me, I'm staying out of this til I see a bit more of it. The devil is always in the details in these things and no where near enough of these are out yet.

 

Good point. Here are some more details from the Wall Street Journal: https://archive.is/fLkPZ

• 'nonmilitary spending roughly flat for the 2024 fiscal year, which begins Oct. 1, and sets a 1% cap on spending increases for the 2025 fiscal year. After that, the deal includes spending targets that aren’t enforceable.
  
• Defense spending in fiscal 2024 would be roughly at the level of Biden’s fiscal 2024 budget request, about a 3% increase.
  
• Reduce the planned $80B increase to the IRS to a $70B increase
• tightening work requirements for federal aid - the deal is also expected to relax the work requirements for veterans and homeless people, whose circumstances can make it hard for them to comply with the program’s requirements.
  
• speed up the approval process for energy projects, which can sometimes drag on over several years. The deal requires that a single federal agency take charge of a project’s environmental review, assuming responsibility for the review’s timeline. Right now, multiple agencies often perform their own, individual environmental assessments, which extends the review process.'

Where are the cuts?

This gives in to the Dems demand that COVID level spending becomes the new baseline.

I'm certain that the GOP does not want to raise the 50 year long term spending at 20% of GDP to 25% of GDP, that's an abrupt 25% increase in the size of government.



I think McCarthy got rolled.

I think they should hold off on a House vote until the Senate passes something, either the House bill or something else, and then if the Senate bill differs from the original House bill, work out the differences between the bills in reconciliation.

 

How is McCarthy going to hold Biden to his commitments to only raise spending by 1%, next year, without a debt ceiling limit? All Biden has to say is "I changed my mind" and what leverage does McCarthy have to make Biden keep his word, if he agrees to this high of a debt limit increase?

 

Lee & Graham are reportedly planning to do everything that they can to slowdown the vote which would probably push it beyond 6/5

Any damage from that would be on the GOP

 

Most Americans also wanted to include tax increases — and close loopholes for tax cheats. Good to know what group is the most important

 

I wouldn't worry about the congress dems voting for it. They are going to have a meeting with Biden and I expect that they will vote in lock step just like they always do.

I'm more worried about the freedom caucus holding things up beyond the June 5th deadline.

 

"historic reductions in spending"

Really? I don't think so, unless you call 1% "historic."

Caution: It is not over yet. Raising the debt ceiling must be approved by the House and the Senate.

The Republicans backed down on most of their demands, and the House bill to raise the debt ceiling, but gutted the Biden administration was forgotten. This is not a surprise. They were wrong to hold the American economy and the American people hostage for demands they could not obtain through ordinary means.

The Guardian reports, "Joe Biden and Kevin McCarthy have reached an agreement to lift the US debt ceiling and avoid a disastrous and unprecedented default. Prior to the details being presented to lawmakers, ahead of an expected vote on Wednesday, here is what sources familiar with negotiations have revealed:
Cap on discretionary spending
The deal would suspend the $31.4tn debt ceiling until January 2025, allowing the government to pay its bills. In exchange, non-defense discretionary spending would be “roughly flat” at current year levels in 2024. It would increase by only 1% in 2025.
What about the 2024 presidential election?
The debt limit extension schedule means Congress would not need to address the deeply polarizing issue again until after the November 2024 election. Note: In other words, a two-year deal.
Increased defense spending
The deal is expected to boost defense spending to around $885bn, in line with Biden’s 2024 budget spending proposal, an 11% increase from the $800bn allocated in the current budget.
Special IRS funding for federal tax authorities
Biden and Democrats secured $80bn in new funding for a decade to help the Internal Revenue Service enforce the tax code for wealthy Americans in last year’s Inflation Reduction Act.
Covid clawback, cuts for the CDC
Biden and McCarthy are expected to agree to claw back unused Covid-19 relief funds as part of the budget deal.
Work requirements
Biden and McCarthy battled fiercely over imposing stricter work requirements on low-income Americans who benefit from federal food and healthcare programs. No changes were made to Medicaid health insurance in the deal, but the agreement would impose new work requirements on low-income people who receive food assistance, up to age 54, instead of 50.

 

Gee, I wonder if those cuts will be to programs for the people or to the billion dollar military industrial complex funding....

 

The MAGA types are calling this bill worse than a clean debt ceiling bill. As more information comes out it appears it McCarthy is going to depend on Democrats passing it. No deficit reduction, no spending cuts, and debt-ceiling off the table for the remainder of Biden’s term.