The four top congressional leaders from both parties plan to sit down again Wednesday morning with senior Trump administration officials to try to hammer out an agreement on next year’s spending levels.
The talks at the Capitol will include acting White House Chief of Staff Mick Mulvaney, Treasury Secretary Steven Mnuchin, and acting budget director Russell Vought, according to sources familiar with the plans.
The group is attempting to avert a trifecta of adverse consequences for the U.S. economy and critical government services: another lengthy shutdown after the current fiscal year ends Sept. 30, default on U.S. financial obligations, which could occur around the same time, and automatic cuts that could slice 10 percent on average from federal agency budgets after the first session of the 116th Congress ends.
A round of meetings on May 21 with the same principals involved got off to a positive start, but then petered out in the afternoon. Since then top Democrats and President Donald Trump have been increasingly at odds on a variety of issues, and Democratic leaders have questioned the White House’s willingness to cut deals.
The main issue in the spending talks has been how much to increase nondefense appropriations accounts above the tight limits mandated for fiscal 2020 and 2021 under a deficit reduction law enacted in 2011. Recently, senior lawmakers in both parties have signaled a willingness to narrow their deliberations to a one-year deal, despite the political inconvenience of having to come back next year and do it all over again during an election cycle.
The two parties are more in lockstep on defense funding for fiscal 2020, though House Democrats are pitching a 2.4 percent boost above the current year while President Donald Trump and senior Republicans want a 5 percent increase. On nondefense, however, Trump wants to adhere to the cuts scheduled under current law, while House Democrats have written their spending bills at 5.7 percent above fiscal 2019 comparable levels.
Senate Minority Leader Charles E. Schumer, D-N.Y., said at a news conference Tuesday he planned to push for “robust” funding levels, and also said he’d make a pitch for election security funds to combat foreign interference.
The statutory debt limit is tied up in the discussions both because of the timing — independent forecasts say Treasury will run out of borrowing room sometime in late September or early October, right when Trump needs to sign spending bills or a continuing resolution to avoid a shutdown — and because Democrats view it as leverage.
House Speaker Nancy Pelosi, D-Calif., said last week that Democrats won’t support breaking out the debt limit for a separate vote unless a spending caps deal is reached in advance or as part of the same package. The 2018 caps deal also contained a “suspension” of the debt limit, effectively waiving it, until March 2 of this year although Treasury has several more months of wiggle room because of accounting moves.
Kellie Mejdrich contributed to this report.