"I am pleased to announce that a deal has been struck with Senate Majority Leader Mitch McConnell, Senate Minority Leader Chuck Schumer, Speaker of the House Nancy Pelosi, and House Minority Leader Kevin McCarthy - on a two-year Budget and Debt Ceiling, with no poison pills," Trump tweeted Monday afternoon. "This was a real compromise in order to give another big victory to our Great Military and Vets!"
According to the Wall Street Journal, which cited people familiar with the matter, the deal will increase spending by roughly $320 billion above the limits set by the 2011 Budget Control Act - that's $30 billion less than the Democrats wanted but only half the $150 billion in savings Trump hoped for. Nearly $80 billion of that spending will be offset by cuts in other areas.
If passed, the deal will ensure the government doesn't miss debt payments in early September and would cancel automatic cuts that would have reduced domestic spending by $55 billion and military spending by $71 billion, compared to the 2019 budget, Bloomberg noted.
The deal, which was agreed to by Republican and Democratic leaders in the House and Senate, is only an agreement to move forward on the relevant bills. The Democrat-controlled House will need to approve the deal before the week is out and its six-week recess begins, but the Republican-controlled Senate will have through next week to advance the bill. Bloomberg noted that Trump didn't explicitly say he'd sign that bill, though.
Moreover, the deal won't avoid the possibility of another budget shutdown in October, similar to the conflagration that erupted in the final days of 2018.
The US reached its $22 trillion borrowing limit in March, and the US Treasury has been using so-called "extraordinary measures" since then to ensure the US government doesn't default on its debt.
The 2011 Budget Control Act was, ironically enough, produced by Republicans themselves, whose powerful, organized bloc in Congress in August 2011 forced then-President Barack Obama to strike an 11th-hour deal hemming in future government spending while avoiding an immediate default.
"That agreement produced the Budget Control Act of 2011, which extended the debt ceiling but mandated massive cuts on spending before another extension could be granted," Sputnik reported. "If they weren't agreed upon by Congress, they would automatically kick in on January 1, 2013, implementing indiscriminate reductions in spending across the entire budget in a process dubbed 'sequestration.'"
The agreement laid out future limits on discretionary spending by year, with separate amounts for defense and non-defense spending, with the ultimate goal of reducing the US national debt by $1.2 trillion by 2022, creating the present situation. Still, the deal may push the annual budget deficit over $1 trillion next year.