Biden and McCarthy Reach Tentative Debt Limit Deal

With just more than a week until the U.S. risks running out of cash to pay its bills, the two leaders now must convince enough members of their respective parties that the agreement hashed out by a small group of negotiators is a better deal than the global economic consequences of default.

A time-consuming, last-minute revision or a failure on the House floor risks a market dive, as happened when the 2008 bank bailout legislation failed to pass.

McCarthy has said he’d abide by a 72-hour rule to allow lawmakers to review legislation and is planning a House vote on Wednesday.

In the Senate, any one lawmaker can tie up legislation and force procedural votes. Utah Republican Mike Lee has already said he would do just that if he doesn’t like spending levels in the bill.

That leaves little room for failure — or time for revisions — if Congress is to pass the legislation before June 5, Treasury Secretary Janet Yellen’s revised X-date.

Republican Patrick McHenry, one of McCarthy’s chief negotiators, acknowledged as much on Saturday, saying it would be a “severe challenge” to get the bill passed by the deadline.

While Biden and McCarthy are managing the clock, they also need to manage their party’s caucuses in each chamber.

House Democratic leader Hakeem Jeffries, Senate Majority Leader Chuck Schumer and Senate GOP leader Mitch McConnell will be tasked with mobilizing arm-twisters to convince the flanks.

But the deal ultimately belongs to Biden and McCarthy, who will have to cobble together a coalition of centrists to support it.

The two-year budget deal cuts far less spending than the $4.8 trillion in cuts the House put on the table at the start of talks. It also gives heartburn to progressives, who already have agitated that Biden hasn’t been vocal enough on the deal.

“I don’t think everybody is going to be happy at the end of the day,” McCarthy told reporters this week. “Is it everything I wanted? No.”

About three dozen members of the conservative House Freedom Caucus have already signaled they won’t support a deal that falls short of their cost-cutting and other demands. They’ve demanded McCarthy “hold the line.”

“Are we going to tuck tail, take the first exit ramp off and walk away?” Freedom Caucus member Chip Roy said on the House floor on Thursday.

Another conservative, Dan Bishop of North Carolina, was more blunt about what would happen if the deal wasn’t to his liking. “It’s war,” he warned in a Saturday tweet.

Not helping matters for McCarthy is former President Donald Trump, to whom many of these conservatives are loyal. Trump, who has been in regular contact with the speaker, has said that the U.S. should default rather than accept a bad deal.

Jeffries will have his own challenge getting 106 or more Democrats to back the deal, even with Biden’s imprimatur on it.

Democrats like Rosa DeLauro, the senior member on the Appropriations Committee, have complained publicly about being sidelined and have condemned any cuts to social programs as “unacceptable.” Congressional Progressive Caucus head Pramila Jayapal said there would be protests in the streets if a deal cut social services.

The expanded work requirements for the Supplemental Nutrition Assistance Program could pose a challenge for Jeffries, who has called such requirements a “non-starter” for House Democrats.

The arm-twisting challenge is exacerbated for House leaders because most lawmakers are out of town for a holiday weekend and not expected to return until Monday night or Tuesday morning.

“That’s always more difficult when they are away,” McCarthy acknowledged.

Assuming the House passes the bill on the first try, it’ll head to the Senate around mid-week. There, days of procedural wrangling are likely if Lee makes good on his threat to hold things up. That easily takes voting right into the weekend, and the U.S. right to the brink.

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