With the administration’s deadline for default roughly a day away, negotiations shifted again to the Senate late Wednesday, with Democratic and Republican leaders optimistic that a deal could be announced soon.
Senate Majority Leader Harry Reid and Minority Leader Mitch McConnell restarted talks that had stalled for much of Tuesday soon after it became clear that the House’s attempt to pass legislation had failed. And a deal, which leaders had said was close to the finish line before Tuesday’s detour, appeared to coalesce quickly.
The agreement, which had yet to be announced by the leaders as of Tuesday night, would extend the debt limit until Feb. 7, and include a continuing resolution until Jan. 15, according to a source familiar with the negotiations. The deal would also include a Dec. 15 deadline for a budget conference report, as well as an antifraud provision designed to verify income for those who receive subsidies under the Affordable Care Act, the source said.
The next procedural steps in the Senate are still murky. Senators and aides say there was concern that the agreement could be held up — although not completely blocked, assuming Reid and McConnell instruct senators not to filibuster — because of the Senate’s rules requiring up to 30 hours before a vote.
“There are ways for members of the Senate to delay even a bipartisan agreement if they wish,” said Majority Whip Dick Durbin, D-Ill. “I hope they don’t.”
Asked whether Reid would file for cloture Tuesday night on a Senate bill, Durbin said the details were still being worked out with McConnell.
“Basically in order to move this quickly [Wednesday] or as soon thereafter as possible, we need the cooperation of members,” Durbin said. “If they want to drag their feet, use every objection they can, this could take a few days.”
The Treasury Department set Oct. 17 — Thursday — as a deadline for default, and Secretary Jacob Lew is to meet with President Obama on Wednesday.
After arching their backs at the notion that House Speaker John Boehner would propose a GOP alternative to the Reid-McConnell deal, Senate Democratic leaders seemed reassured that the bipartisan talks were back on track.
“Things look a lot better than they did several hours ago,” said Sen. Chuck Schumer, D-N.Y., who declined to elaborate.
Durbin would not confirm that a deal had been inked, but sounded optimistic.
“There was definitely a suspension of negotiations until Speaker Boehner’s plight was obvious,” he said. “They’re still working on the details between Senators McConnell and Reid. We’re making good progress.”
One sign of what’s at stake came when the credit-rating agency Fitch put the United States’ AAA credit rating under review on Tuesday. In a statement, the agency said that “although Fitch continues to believe that the debt ceiling will be raised soon, the political brinkmanship and reduced financing flexibility could increase the risk of a U.S. default.”
Of course, lawmakers have had months to avert the current crisis. But as illustrated yet again Tuesday, olive branches are easily snapped in this Congress, and partisanship and political pressure are highly valued. The implosion on Tuesday of the House plan to put legislation to a vote was a very public example.
That plan, as initially laid out to rank-and-file members in a closed-door meeting, seemed to build on the Senate framework, with the addition of items that the House Republicans have been seeking, such as a two-year delay of a medical-device tax and language to ban government health care subsidies for members of Congress and the president’s Cabinet.
But it became clearer throughout the day that the plan was simply inadequate for some conservatives. By early evening, the death knell may have come in the form of an announcement by the influential conservative group Heritage Action, which opposed the bill and announced that it would be included as a key vote on the group’s legislative scorecard.
It was soon after that House Rules Committee Chairman Pete Sessions, R-Texas, announced that a hearing to set procedures for a floor vote Tuesday night was postponed. Sessions and other House GOP leaders retreated to Boehner’s office. Shortly before 7 p.m., they emerged to say there would not be any House votes Tuesday night.
Sessions did not say what, exactly, the House planned to do on Wednesday beyond having more “discussion.” But he did remark, “We’re waiting for the Senate to get its work done.”
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"Even if House Republicans manage to get enough members of their party on board with the latest version of their health care bill, they will face another battle in the Senate: whether the bill complies with the chamber’s arcane ... Byrd rule, which stipulates all provisions in a reconciliation bill must affect federal spending and revenues in a way that is not merely incidental." Democrats should have the advantage in that fight, "unless the Senate pulls another 'nuclear option.'”
The House has passed a one-week spending bill that will avert a government shutdown which was set to begin at midnight. Lawmakers now have an extra week to come to a longer agreement which is expected to fund the government through the end of the fiscal year in September. The legislation now goes to the Senate, where it is expected to pass before President Trump signs it.
President Trump’s portrayal of an effort to funnel more Medicaid dollars to Puerto Rico as a "bailout" is complicating negotiations over a continuing resolution on the budget. "House Democrats are now requiring such assistance as a condition for supporting the continuing resolution," a position that the GOP leadership is amenable to. "But Mr. Trump’s apparent skepticism aligns him with conservative House Republicans inclined to view its request as a bailout, leaving the deal a narrow path to passage in Congress."
Democrats in the House are threatening to shut down the government if Republicans expedite a vote on a bill to repeal and replace Obamacare, said Democratic House Whip Steny Hoyer Thursday. Lawmakers have introduced a one-week spending bill to give themselves an extra week to reach a long-term funding deal, which seemed poised to pass easily. However, the White House is pressuring House Republicans to take a vote on their Obamacare replacement Friday to give Trump a legislative victory, though it is still not clear that they have the necessary votes to pass the health care bill. This could go down to the wire.