White House, Republicans reach tentative debt ceiling deal

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Key negotiators struck an agreement in principle Saturday night to extend the debt ceiling and avert a catastrophic default, just days before the Treasury Department says the U.S. could run out of money, Speaker Kevin McCarthy said Saturday.

The deal — which is expected to raise the country's borrowing authority in exchange for cuts to spending — still has to be converted into legislative language and pass both the Republican-led House and Democratic-controlled Senate. It follows weeks of negotiations led by President Joe Biden and Speaker Kevin McCarthy, amid demands by the GOP to extract spending cuts in exchange for allowing the nation to continue to pay the bills.

"We’ve come to an agreement in principle that is worthy of the American people," McCarthy said Saturday on Twitter.

"We still have more work to do tonight to finish all the writing of it," McCarthy told reporters afterward outside his Capitol office, adding that he expects to post the text on Sunday and hold a House vote on it Wednesday.

He added that he'll speak to Biden again on Sunday.

A source familiar with the agreement said it includes a two-year appropriations deal and a two-year debt limit extension, effectively resolving the issue until after the 2024 election. It'll include work requirements for federal aid like SNAP for Americans up to 54, with exceptions for homeless people and veterans.

Biden and McCarthy spent an hour and a half on a call Saturday night, a rare one-on-one conversation between the two leaders that followed days of fraught talks over the final sticking points.

Top Republicans had been in and out of the speaker's office on Saturday as negotiations continued, with some of the talks taking place virtually and by phone. Shalanda Young, a top negotiator for the White House, was in Louisiana to deliver graduation remarks at Xavier University where she quipped that the two-hour break was "the most fun I’ve had in two weeks.”

Republican leaders began preparing to sell a bill to the GOP conference late Friday with a deal still out of reach.

Conservatives skeptical of Republican leadership had threatened to hold up the bill if the speaker struck a deal with Democrats that failed to slash spending, with one outside adviser warning of coming “trench warfare.

McCarthy has said in recent days he'll give members 72 hours to review the text before holding a floor vote. And Sen. Mike Lee, R-Utah, has threatened to block a speedy vote in the Senate if he isn't satisfied with the terms of the deal, meaning it could take days for the chamber to jump through procedural hoops before a vote.

Extending the debt ceiling doesn’t authorize new spending into the future; it enables the U.S. to pay existing debts that both parties have accumulated over many years through demands for higher spending on domestic and military programs, as well as lower taxes.

Negotiating staff for McCarthy and the White House held back-to-back negotiating sessions, some stretching late into the night before resuming again. The Republican push to add work requirements to social safety net programs remained an obstacle until the final moment.

Rep. Ro Khanna says 'large majority' of House Democrats are 'in flux' on the deal
Rep. Ro Khanna, D-Calif., a member of House Progressive Caucus, said Sunday night that he was undecided about how he would vote on the budget deal hammered out by the White House and congressional Republicans.

“My sense is a large majority of the House Democratic Caucus is in flux as to where they’re going to be on this,” he said in an interview with NBC News.

Khanna said he is concerned about how the deal treats student loan forgiveness and work requirements for entitlement programs. He said he was also troubled by language in the bill that would expedite completion of the Mountain Valley Pipeline, a victory for influential Sen. Joe Manchin, D-W.Va., but a setback for the environmental movement.

Khanna added he wanted to talk to more colleagues before he decides how to vote — the progressives have scheduled a conference call for Monday, he said.

White House holding calls with House Democrats on Monday and Tuesday
The White House will hold calls with House Democrats on Monday and Tuesday to discuss the debt ceiling deal in granular detail, two sources with knowledge of the plan said.

There will be three meetings each day, which will focus energy policy, appropriations levels and changes to Temporary Assistance for Needy Families and the Supplemental Nutrition Assistance Program, the sources said. The briefings, which will take place in the afternoons, will be led by White House energy adviser John Podesta, Office of Management and Budget Director Shalanda Young, and economic adviser Aviva Aron-Dine.

SNAP work requirements, Covid clawbacks top Democrats' concerns, House member says
House Democrats raised concerns about Covid clawbacks and work requirements for the Supplemental Nutrition Assistance Program during Sunday night call with the White House about the debt ceiling deal, a House member who was on the call said.

Representatives from various Democratic caucuses, including the New Democrat Coalition, the Progressive Caucus, and the Black, hispanic and Asian Pacific American caucuses raised questions about the deal during the hour-long all. The White House emphasized the GOP provisions that President Joe Biden prevented from being included in the deal, the lawmaker said.

The race is on for congressional leaders to secure the votes to pass a bipartisan compromise struck by President Joe Biden and House Speaker Kevin McCarthy to avert a catastrophic debt default with just a week to go before the June 5 deadline.

Facing skepticism or criticism within their ranks, both party's leaders mobilized Monday to shore up support for the bill.

House Republicans leaders held a conference call with reporters Monday to promote the agreement.

“This is a historic Republican victory,” said Rep. Elise Stefanik, R-N.Y., the GOP conference chair. “It will cut spending year over year.”

Republican hard-liners in both chambers sniped at the deal, setting the stage for a contentious showdown Tuesday in the House Rules Committee, which is scheduled to consider the bill before an expected vote in the full House on Wednesday.

Rep. Ralph Norman, R-S.C., called the deal "insanity" and said the bill has "virtually no cuts." Rep. Chip Roy, R-Texas, issued a torrent of tweets blasting the deal as a "turd-sandwich." Norman and Roy are on the Rules Committee. Sen. Rand Paul, R-Ky., said the deal has "fake spending cuts."

"Conservatives have been sold out once again!" he tweeted.

Still, those right-wing members may be a minority among Capitol Hill Republicans. Some are confident the bill will succeed.

“Oh, this thing will absolutely pass,” Rep. Dusty Johnson, R-S.D., the chair of the center-right Main Street Caucus, told reporters. “There’s no question about that. I’ve talked to dozens of members — and listen, not every single member is on board. But when was the last time that every single member of Congress agreed on anything?”

GOP congresswoman: 'We're going to get there'
Numerous McCarthy allies touted new Congressional Budget Office estimates provided to some in Republican leadership that haven't been made public, two GOP sources said. The estimates say the Biden-McCarthy debt ceiling bill would cut $2.1 trillion in spending if the targets are met over six years — although only two years are binding in the bill.

The legislation would extend the debt limit for two years and pair it with a two-year budget accord that would modestly reduce nondefense spending and bump up military spending to $886 billion — the amount Biden requested for next year.

Sen. Lindsey Graham, R-S.C., blasted the bill as a "catastrophe for defense" on Twitter, saying Biden's Defense Department spending figure was inadequate and threatening to hold up the bill in the chamber. If the House passes the bill Wednesday, the Senate would have five days to pass it by the deadline next Monday.

Rep. Stephanie Bice, R-Okla., said the bill will pass with support from both parties.

“We’re going to get there," Bice said. "There’s going to be bipartisan support on this legislation. The president is supporting it. I think that we’re in a really good place. Spending cuts are what we asked for; no new taxes are what we asked for; no clean debt ceiling is what we asked for. And that’s exactly what we’ve got.”

House progressives were silent for most of Monday as they held an afternoon call to discuss the legislation and the way forward.

Privately, some expressed disappointment with provisions like expanding work requirements from people age 50 to those age 55 for federal benefits like the Supplemental Nutrition Assistance Program and Temporary Assistance for Needy Families. They're also unhappy that the bill would expedite the Mountain Valley Pipeline, a natural gas pipeline under construction from northwestern West Virginia to southern Virginia, and overhaul permitting for energy and infrastructure projects.

Congressional Progressive Caucus Chair Pramila Jayapal, D-Wash., said the rules about work are "bad policy" that wouldn't help reduce unemployment.

"We have seen reams of data that show that when you put these work requirements in, they’re really just administrative red tape that prevent the people who need help from getting help," she said Sunday on CNN's "State of the Union."

Democrats say it rejects 'extreme' GOP demands
Meanwhile, House Democratic leaders sent a memo encouraging lawmakers to sell the legislation as a defeat for "extreme MAGA Republicans" and arguing that it rejects "Republicans’ extreme demands to cut critical lifelines for everyday Americans."

House Democrats face some internal conflict about how to proceed, according to sources in the caucus. Apart from the policy concerns, some are upset that they were largely excluded from the negotiations and don't feel a primary responsibility to carry the bill over the line. But they're also heavily invested in political success for Biden and in protecting the U.S. economy, which some believe will be enough to gain passage.

As criticism builds in Republican ranks over the debt ceiling deal struck by House Speaker Kevin McCarthy, R-Calif., and President Joe Biden, some hard-line conservatives have begun floating the idea of toppling the speaker.

On a House Freedom Caucus call Monday night, Rep. Ken Buck, R-Colo., floated using the motion to vacate, a rule that would allow any member of Congress to force a vote to remove the speaker, two sources familiar with the call told NBC News. Buck, speaking toward the end of the call, referred to it as the “elephant in the room,” one source said.

After House Freedom Caucus Chairman Scott Perry, R-Pa., suggested it might be too early for such a drastic threat, Rep. Paul Gosar, R-Ariz., proposed using the threat to force McCarthy to allow members to amend the bill on the House floor, under an "open rule" that could stall the bill's passage. Perry responded that they would discuss the issue more when members return to Washington after the long weekend.

One lawmaker on the call who confirmed that Buck brought up using the motion to vacate said of the Biden-McCarthy deal, “Some people feel this is a complete miss,” adding, “I’d say there are five or more who would be sympathetic to Buck’s position.”

Another lawmaker who was on the call, but did not hear Buck's suggestion, said bluntly, “The unity we had is gone.”

Nearly a dozen House Freedom Caucus members slammed the debt ceiling bill in a press conference Tuesday and vowed to vote no, but when asked how many of their members would support a motion to vacate, only Rep. Dan Bishop, R-N.C., raised his hand.

Asked Tuesday afternoon if he was worried about Bishop threatening a motion to oust him, McCarthy replied: “No, that’s his choice.”

While right-wing members have blasted the deal publicly — calling it "insanity" and a "turd-sandwich" and criticizing the scale of the cuts — lawmakers had held back from threatening to oust McCarthy over the agreement.

Over the weekend, many lawmakers dismissed using the motion to vacate when asked whether they would threaten McCarthy’s speakership over the debt bill, even as growing numbers say they intend to vote against it.

But, as one former Republican White House official told NBC News over the weekend after the deal was announced: “McCarthy is now on a clock.”

At Tuesday's press conference, Rep. Chip Roy, R-Texas, warned of a “reckoning” for Republican leaders “unless we stop this bill by tomorrow.”

“The Republican conference right now has been torn asunder,” Roy said, urging that "not one Republican" should vote for the bill.

Asked how many members would support the motion to vacate, Perry said he was “focused on defeating this bill,” declining repeatedly to discuss the issue.

“What happens post that and the agreements that we have, we will decide once we’ve determined the disposition of this bill and its finality,” Perry said.

The debt ceiling deal brokered by President Joe Biden and House Speaker Kevin McCarthy cleared a major procedural hurdle on Tuesday night, just days before a potential default by the U.S. government.

The House Rules Committee gave the green light for the Fiscal Responsibility Act to advance to the full House so members can hold a planned vote on Wednesday night before sending the legislation to the Senate ahead of Monday’s default deadline.

The panel advanced the bill to the floor for debate in a narrow 7-6 vote.

In a big win for Republican leadership, Rep. Thomas Massie of Kentucky -- a GOP hard-liner and fiscal hawk -- voted in favor of the rule.

Today's bill is a product of compromise and reflects the realities of a divided government," Oklahoma Republican Rep. Tom Cole, who supported the rule for the proposal, said as he began the meeting.

In his own remarks, Massie said, "My interest in being on this committee was not to imprint my ideology. I think that is an inappropriate use of the committee." He later told reporters he planned to vote for the deal on the floor.

House Minority Leader Hakeem Jeffries said Tuesday Republicans have said they will deliver 150 votes from their party, and "House Democrats will make sure that the country does not default."

The New Democrat Coalition, made up of roughly 100 House Democrats, has endorsed the debt ceiling deal.

With overwhelming bipartisan support, the House voted Wednesday to pass the debt ceiling legislation negotiated by Speaker Kevin McCarthy and President Joe Biden, sending it to the Senate with days to spare before a potentially disastrous default.

The vote was 314 to 117, with 149 Republicans joining 165 Democrats.

The bill would extend the debt limit for two years alongside a two-year budget agreement if it is signed into law. It is the culmination of months of political warfare and weeks of frenzied negotiations between the two parties that finally broke a lengthy stalemate.

The deal overcame heavy criticism from GOP hard-liners, who argued that its spending cuts and conservative provisions are too weak. It also faced opposition from Democrats, who criticized the added work requirements and nondefense spending cuts negotiated by the two men.

“You are getting so many wins for the American people in this bill,” said McCarthy, R-Calif., who hailed it as a measure that “moves us in the right direction” fiscally. He said his message to fellow Republicans on Wednesday was: “You’re not spending more money. There’s no new government programs. There’s no tax increases. There’s nothing in the bill that you really should be negative about.”

Biden praised its passage.

"This budget agreement is a bipartisan compromise," Biden said in a statement. "Neither side got everything it wanted. That’s the responsibility of governing."

The bill now goes to the Democratic-led Senate, where it needs 60 votes before it can get to Biden’s desk. Majority Leader Chuck Schumer, D-N.Y., and Minority Leader Mitch McConnell, R-Ky., have both endorsed it and called for speedy passage.

Biden praised its passage.

"This budget agreement is a bipartisan compromise," Biden said in a statement. "Neither side got everything it wanted. That’s the responsibility of governing."

The bill now goes to the Democratic-led Senate, where it needs 60 votes before it can get to Biden’s desk. Majority Leader Chuck Schumer, D-N.Y., and Minority Leader Mitch McConnell, R-Ky., have both endorsed it and called for speedy passage.

The Biden-McCarthy agreement wouldn't make changes to Social Security, Medicare or Medicaid.

An analysis by the nonpartisan Congressional Budget Office found that if the bill's spending caps and targets are followed, it would reduce federal discretionary spending by $1.3 trillion over the next 10 years. Only the first two years of spending levels would be binding under the legislation, however.

The SNAP reforms would actually net a spending increase of $2.1 billion, the CBO found. The new work rules would save $6.5 billion, but the new exclusions for homeless people and veterans would add 78,000 people to SNAP benefit rolls and cost $8.6 billion.

Hard-right members tore into the measure.

Senators who oppose it, like Mike Lee, R-Utah, have procedural tools they could use to try to slow it down past Monday's deadline. Schumer has encouraged members to act quickly to avoid default.

"Senators should be prepared to move on this bill quickly once it is the Senate's turn to act. I cannot stress enough that we have no margin — no margin — for error," Schumer said Wednesday, warning that "any needless delay, any last-minute brinkmanship" could mean that "the federal government will default for the first time ever."

McConnell quickly praised House passage of the bill on Twitter and added: “Now, it’s the Senate’s turn to pass this agreement without delay.”