Steve Holland and Jarrett Renshaw
WASHINGTON (Reuters) – U.S. President Joe Biden and House Republican Speaker Kevin McCarthy on Saturday Reached an agreement in principle to remove the debt ceiling, which would cut some of the indebted U.S. federal spending.
While the bill is still being drafted, Democratic and Republican sources have outlined the broad outlines of the deal. Here’s what we know so far:
cap on discretionary spending
the deal will be suspended $11.4 trillion debt ceiling until January of 2024, allowing the US government to pay its bills. In exchange, non-defense discretionary spending would be capped at current year levels in 2024 and increased by only 1% in 2024.
The U.S. government will spend 800 $800 in 936 non-defense discretionary spending, The Office of Management and Budget estimates the money goes to housing, education, road safety and other federal programs.
cheers for the 2024 election
extending the debt limit past 2024, which means Congress doesn’t need to address this deeply polarizing issue again after the November 2024 presidential election.
That would prevent another political showdown that unnerves global investors and markets until a Republican is elected president or Biden wins a second term.
Increase defense spending
Under Biden’s 2024 budget spending proposal, the deal is expected to increase defense spending to approximately 800 One hundred million U.S. dollars.
Increased 50 over the 80 billion dollars allocated % of current budget.
Move IRS special funds
Biden and Democrats get 80 $100 million New funding provides a decade of funding to help the IRS enforce tax laws targeting wealthy Americans in last year’s Lower Inflation Act, a move the administration says will yield 80 million dollars in additional revenue for the next years.
Republicans and Democrats are fighting to shift allocations under the “mandatory spending” act, freeing it from the political battle of the annual budget process, to “discretionary spending” allocated by Congress.
The IRS plans to use the money to hire thousands of new agents, and the additional tax revenue they generate is expected to offset the massive climate-friendly tax credits. Republicans argue that auditors will ultimately target middle-class Americans, though the Treasury Department and Biden have said they will focus on high-income households.
COVID CLAWBACK
Biden As part of the budget deal, McCarthy and McCarthy are expected to agree to claw back unspent COVID relief funds, including those set aside for vaccine research and disaster relief funds. The estimated amount of unutilized funds ranges from $50 billion to $56 Billion.
Work requirements
Biden and McCarthy battle over tougher work requirements for low-income Americans to qualify for food and health care programs struggle.
There are no changes to Medicaid in the agreement, but the agreement will introduce new work requirements for low-income people who receive food assistance under a program known as SNAP. They will apply to recipients of age 56, not age 54 ) as proposed by the Republicans.
SNAP, the Supplemental Nutrition Assistance Program, is a federal nutrition assistance program reaching over 56 million people.
Energy Permits
Biden and McCarthy agreed to new rules to make it easier for energy projects, including those based on fossil fuels, to get permits approved. McCarthy and his fellow Republicans have identified permissive reforms as one of the pillars of any deal, a plan the White House endorsed earlier this month.
Biden protects signature climate provision of his inflation-reduction bill, sources say.
A bill that would facilitate power transmission between U.S. regions is being seen as part of negotiations, Reuters reported on Thursday. The measure could be combined with slight changes to the National Environmental Policy Act, or NEPA, a cornerstone of U.S. environmental law that governs environmental reviews of projects such as roads and pipelines.
