White House officials and congressional leaders are drawing closer to a two-year budget agreement that also raises the debt ceiling, although both sides caution that some serious obstacles remain to a deal.
Speaker Nancy Pelosi (D-Calif.) and Senate Minority Leader Chuck Schumer (D-N.Y.) emerged from a 45-minute meeting on Wednesday optimistic they can reach an agreement this week. Pelosi and Schumer spoke on the phone with Treasury Secretary Steven Mnuchin during the session. Mnuchin, who is leading the budget talks for the White House, is attending a G7 finance ministerial meeting in France.
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“If we’re going to act by next Thursday, which is what we’d like to do to honor regular order, we have to get something soon so we can post with enough time,” Pelosi told reporters. The House is scheduled to adjourn next week for the August recess.
“We were on the phone with Mnuchin and we’re making progress,” Schumer added. ” I’m very hopeful, ok? That’s all I can say.”
Any agreement would raise discretionary spending caps for 2020-21, as well as boost the debt limit. Mnuchin has warned that the Treasury Department will reach its borrowing limit in early September, raising the urgency for a deal before Congress leaves town.
Democrats have demanded similar increases in military and non-military spending. Pelosi also wants a $22 billion boost over the next two fiscal years for veterans health care. The White House and GOP leaders on Capitol Hill want some offsets to the new spending. Recent projections show the federal deficit will be roughly $1 trillion this year.