After weeks of partisan gridlock, Republicans and Democrats have brokered an agreement to raise the national debt limit through early December, Senate Majority Leader Chuck Schumer announced Thursday, staving off a perilous default crisis.
“We have reached agreement to extend the debt ceiling through early December and it’s our hope that we can get this done as soon as today,” Schumer said on the Senate floor.
On Wednesday, Senate Minority Leader Mitch McConnell made a short-term offer to avoid such a calamity, prompting discussion between the parties to reach a deal.
For weeks, McConnell and the GOP at large had demanded that Democrats be responsible for financing their own spending sprees, urging them to pass an increase in the debt ceiling through the reconciliation process, which only requires a simple majority of 51 votes. Democrats have argued that Republicans have contributed to the massive debt burden, too, and should therefore help sustain it.
Schumer had claimed that with the government cash vault expected to run dry by October 18, according to Treasury Secretary Janet Yellen, the Democrats had too narrow of a time window to expand the debt limit through reconciliation.
To resolve the dispute, McConnell’s proposition presented three avenues forward to prevent economic havoc. In one scenario, Senate Republicans would agree to erect fewer roadblocks to allow Democrats to raise the debt limit through reconciliation on an expedited basis. In a second scenario, which Schumer selected, Republicans would agree to support a temporary extension of the debt ceiling to cover spending into December.
“Republican and Democratic members and staff negotiated through the night in good faith,” McConnell said Thursday following Schumer. “The Senate is moving toward the plan laid out yesterday to spare the American people a manufactured crisis.”
A third proposal McConnell laid out, which Schumer was likely to refuse, was Republican cooperation on a longer term bipartisan debt ceiling increase in exchange for Democrats abandoning their gargantuan $3.5 trillion social safety net legislation pending in the House.
The arrangement secured Thursday will increase the debt ceiling by $480 billion, which will fund the government until December, an aide with knowledge of the negotiations told CNN. McConnell said on the Senate floor that Democrats now have nearly until the end of 2021 to use the budget reconciliation procedure to lift the debt limit, without Republican votes, to subsidize their new sweeping programs, defeating “the majority’s excuse that they lacked time.”