White House, congressional Democrats agree on debt ceiling hike

By Government SpendingFOXBusiness

Trump: Two-year debt ceiling and budget deal has been reached

On Monday, President Trump tweeted that a two-year debt ceiling and budget deal has been reached.

The White House and congressional Democrats agreed Monday on a two-year budget deal that settles on a new debt ceiling and would likely eliminate the risk of a government shutdown this fall.

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"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, with no poison pills," President Trump tweeted on the agreement.

Trump called the two-year budget a "real compromise."

"This was a real compromise in order to give another big victory to our Great Military and Vets!" he followed up.

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As part of the agreement, the debt limit will be suspended for two years through July 31, 2021. Likewise, new spending caps reflect the elimination of the budget sequester for two years, "plus a slight increase in spending for both defense and non-defense programs."

The measure will likely advance through the House this week, then win the Senate's endorsement next week before Congress takes its annual August recess.

Pelosi and Schumer said the deal "will enhance our national security and invest in middle class priorities that advance the health, financial security and well-being of the American people."

Earlier Monday, aides on both sides of the talks said a tentative deal would restore the government's ability to borrow to pay its bills past next year's elections and build upon recent large budget gains for both the Pentagon and domestic agencies. It would mostly eliminate the risk of a repeat government shutdown this fall.

The agreement is on a broad outline for $1.37 trillion in agency spending next year and would represent a win for lawmakers eager to return Washington to a more predictable path amid political turmoil and polarization, defense hawks determined to cement big military increases and Democrats seeking to protect domestic programs. Nobody can claim a big win, but both sides view it as better than a protracted battle this fall that probably wouldn't end up much differently.

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Earlier Monday, Trump appeared to indicate he was pleased with the tentative agreement.

"I think we're doing pretty well on a budget. It's very important that we take care of our military. Our military was depleted. In the last two-and-a-half years, We've un-depleted it, to put it mildly," Trump told reporters in an Oval Office appearance on Monday. "We need another big year."

The Associated Press contributed to this report.