Mitch McConnell isn’t exactly prone to public displays of optimism. But the Senate majority leader was downright ecstatic — for him — after a lengthy Tuesday meeting with Democrats and Trump administration officials about cutting a two-year budget deal.
“Very encouraging,” said McConnell (R-Ky.). “Our hope is to make a deal before the day is over.”
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McConnell’s assessment came amid a breakneck pace of talks on Tuesday afternoon to finish an agreement to avoid blunt spending cuts and a potential debt default, a surprisingly positive development amid unending gridlock.
Lawmakers said they were eager for Democrats and Republicans to clinch the deal on an overall budget number to avoid the threats of fiscal calamity and set the table for a summer of writing spending bills.
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.
Though McConnell asserted after a party lunch with Vice President Mike Pence that it appears “everybody” wants a deal to raise spending caps, Senate Minority Leader Chuck Schumer was more cautious on the outlook for an agreement. McConnell courted Trump privately about the need to reach an agreement last week, and Schumer warned that nothing is final until Trump formally endorses any potential deal.
“We’re working hard on it. It was a good, productive meeting,” Schumer told reporters Tuesday afternoon. “There are still some significant issues outstanding, particularly the domestic side spending issues like health care and infrastructure middle-class folks need.”
“Obviously, we need the president to sign off on whatever we agree to,” Schumer added. “But I think they realize, the Republican leadership and the White House that when President Trump shut down the government, and our Republican friends went along with that, it didn’t serve them very well.”
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.
GOP senators that had lunch with McConnell and Pence said they’ve not been briefed on any top line number for annual spending. Two sources expected the blueprint to start from Trump’s requested defense spending number of more than $700 billion and increase domestic spending commensurately.
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.”