DEBT CLOCK — There are SIX DAYS until the earliest possible federal default, according to the Treasury Department’s most recent projection. DEAL OR NO DEAL — The multi-trillion-dollar question on everyone’s mind is whether the negotiators can reach an agreement to lift the debt ceiling before the clock ticks too much further. There’s lots of rumblings from lawmakers on both sides that there could be a handshake deal today, with lawmakers returning to Washington Tuesday or Wednesday for votes — but that may well be wishful thinking, based on the vibes emanating from GOP negotiators Thursday night. A somber and exhausted Speaker Kevin McCarthy offered this to reporters outside his office Thursday evening: “We do not have an agreement yet. We knew this would not be easy. It's hard, but we're working and we're going to continue to work until we get this done.” Earlier in the day, one of the Republican negotiators, Rep. Patrick McHenry (R-N.C.), entered McCarthy’s office with his children in tow — noting he planned to work through the holiday weekend so he could grind out a deal with the White House. One major sticking point, per fellow Republican negotiator Rep. Garret Graves (R-La.), continues to be strengthening work requirements for certain safety net programs. “The White House continues to prioritize paying people to not work over paying Social Security benefits and Medicare benefits,” Graves said. “Their efforts actually put in jeopardy those very benefits to senior citizens like Medicare and Social Security because they're refusing to negotiate on work requirements.” Here’s what we do know: We first scooped in Thursday’s Huddle that an energy transmission bill from Sen. John Hickenlooper (D-Colo.) and Rep. Scott Peters (D-Calif.) is in talks to be included in the proposal. The measure would require regions to be able to transfer electricity between their power networks during times of stress on the grid, but it’s unclear whether Republicans will accept it, our Josh Siegel reports. We also know about some other parameters of the negotiations, including:
- An agreement to lift the debt limit through 2024;
- A procedure incentivize Congress to pass all 12 annual spending bills;
- A plan to claw back unspent Covid money;
- And two years of spending caps that fall between the GOP’s demand for a return to FY2022 non-defense spending levels and Democrats’ offer of a freeze at FY2023 levels.
Our friends at Playbook have some additional details this morning, if you haven’t read yet. Tick-tock: As we’ve noted time and time again, finishing this up could take a while. Hill staff will have to turn any agreement into legislative text, and then, once a bill is filed, House GOP leaders have committed to a 72-hour wait before any vote — part of the deal McCarthy struck with conservatives to win the speaker’s gavel. In that scenario, negotiators will need to clinch a deal today or tomorrow to move a bill through the House before the earliest possible default date Thursday. And then there’s the Senate: No one expects the Senate to pass the bill by unanimous consent — especially after this warning from Sen. Mike Lee (R-Utah), committing to slow down the process — meaning it could take the upper chamber up to three days to pass the legislation before it goes to President Joe Biden’s desk. In other words, we’re looking at a game of legislative chicken with a global economic meltdown on the line. Sen. Chris Coons (D-Del.), the sole senator who could be found during the upper chamber recess Thursday (he presided over the pro forma session), said he hopes all Democrats can support whatever legislation emerges from the negotiations, but he wasn’t sure: “It depends what’s in it. It’s rare that we get absolutely every vote on absolutely everything. But this should be one that you trust our president.” Not to pile on: Jennifer and Caitlin are out with a debt limit FAQ with lots of answers on what happens during a default — revealing that the devastation from a debt default actually gets worse as time goes on. The country technically doesn’t miss interest payments until mid-June. But once it runs out of borrowing power, the government will likely miss checks for critical items like Social Security, veterans benefits, federal salaries and more. Related read: Dems Insisted They Wouldn’t Negotiate. Then Biden Started Negotiating, from Sam Brodey and Matt Fuller at the Daily Beast
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