Shutdown Deadline Looms as Congress Deal Remains Elusive

By Natalie Andrews and Louise RadnofskyFeaturesDow Jones Newswires

A firestorm ignited by President Donald Trump's remarks last week has imperiled lawmakers' ability to reach a deal on immigration and spending levels, according to congressional aides, as a possible government shutdown looms at week's end.

Congressional aides say they are expecting a short-term deal funding the government for a few weeks to come to the table, but caution that is by no means guaranteed. Some said prospects for any deal had diminished because of controversial reported comments last week from President Trump in a meeting with lawmakers about his desire to stop immigration from "shithole countries."

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"Trump's latest self-created outrage du jour makes it harder for us to get Democrats on board for anything," said Doug Heye, a former top Republican congressional aide. "It's not issue specific, it's not just limited to immigration. That's the challenge when we have these outbursts."

Asked about his comments Sunday, Mr. Trump denied reports of his remarks, saying "they weren't made," and accused Democrats of backing away from a deal. Two Republican senators also called into question the reports quoting Mr. Trump, though others in attendance have confirmed them.

Mr. Trump also tweeted Monday that he blamed Democratic Sen. Dick Durbin for having "totally misrepresented what was said at the DACA meeting. Deals can't get made when there is no trust! Durbin blew DACA and is hurting our Military."

GOP and Democratic leaders had engaged with the White House last week on a deal on federal spending that would bring Democratic support to prevent a government shutdown and include protections for young people, known as Dreamers, who were brought illegally to the U.S. as children. It also could include enhanced border security measures, a White House priority. Absent a spending bill, the federal government would shut nonemergency functions starting Saturday at 12:01 a.m.

Democrats say that they will maintain their pressure this week to withhold support for a funding deal that doesn't contain legislation on DACA, the Deferred Action for Childhood Arrivals, which covers the young immigrants.

Meanwhile, Republicans are fighting for an increase in military spending, working on a two-year deal that would not only prevent the budget limits known as the sequester from kicking in, but potentially raise spending beyond that. Democrats, whose votes will be needed to pass spending bills in the Senate and possibly the House, insist that domestic spending levels should be increased on parity with defense spending.

"The mood is so raw over immigration that this issue alone could prompt a shutdown, so I think chances of a shutdown on Friday at midnight are a bit above 50%," said Greg Valliere, the chief global strategist at Horizon Investments. "Trump's provocative tweets don't help; Democrats are itching for a fight with him."

Mr. Trump on Sunday blamed Democrats for the lack of progress on a deal.

"I think you have a lot of sticking points, but they're all Democrat sticking points, because we are ready, willing, and able to make a deal, but they don't want to," he said, ahead of a meeting in Mar-a-Lago, a Trump resort in Florida, with House Majority Leader Kevin McCarthy (R., Calif.)

Some congressional aides now say a likely outcome is another short-term spending bill that pushes the deadline out until around mid-February. Congress passed two short-term spending bills in December.

Rep. Mark Meadows (R., N.C.), chairman of the conservative House Freedom Caucus, suggested that they would likely do so if they had no other way to divert a government shutdown. Extending the deadline would require what is known as a continuing resolution.

"There's a great pushback to another CR, but with that being said, I don't see that a shutdown's an option, so obviously a CR is probably the only thing we've got in our tool bag before the 19th," he said.

Congress is also figuring out how to pay for a long-term reauthorization of the Children's Health Insurance Program and lawmakers in areas affected by recent natural disasters are asking for an increase in relief funding, which could complicate negotiations over even a short-term solution.

"There's a double chance I might not vote for it," Rep. Tom Rooney (R., Fla.), a member of the House Appropriations Committee, said about his support for a short-term spending bill. Among other things, he is concerned that disaster-relief money needed by orange growers in his state would be left out.

"When I can't go home to my district saying 'I've got your back,' it makes it kind of hard for me to a be a team player back here," Mr. Rooney said.

A short-term deal may also provoke the ire of Republican defense hawks, who say short-term measures hamstring military leaders.

"It's better than, one could argue, shutting down the government but it's not giving them the full predictability and resources that they need to be able to invest and plan and move forward," said Rep. Martha McSally (R., Ariz.) in an interview.

Congress set spending levels as part of an agreement reached at the end of a 2011 fight over raising the government's borrowing limit. That agreement was designed to set in motion 10 years of fiscal austerity, including across-the-board spending cuts known as sequestration, but Congress has twice reached two-year budget deals raising the spending caps.

The last two-year agreement ended in September. Since then, lawmakers have opted to extend the government's funding at those levels in a series of short-term spending bills.

Illinois Rep. Cheri Bustos, who has been one of the few Democrats to support recent spending bills that her party has largely opposed, says her support is waning.

"I will agree to buying a little more time but not when buying more time means we're not closer to a solution than we were before," Ms. Bustos said in an interview.

Kristina Peterson and Siobhan Hughes contributed to this article.

Write to Natalie Andrews at Natalie.Andrews@wsj.com and Louise Radnofsky at louise.radnofsky@wsj.com

(END) Dow Jones Newswires

January 15, 2018 16:23 ET (21:23 GMT)