US President Joe Biden speaks about the bipartisan budget deal in the Roosevelt Room of the White House on May 28, 2023.
Yuri Gripus Bloomberg | Getty Images
President Joe Biden and House Speaker Kevin McCarthy signed a deal on Sunday to temporarily suspend the debt ceiling and limit some federal spending to prevent a U.S. debt default.
The agreement has been officially posted, written into legislation and expected to be passed by the House and Senate within days. Official website of parliament.
Discretionary spending cap
The deal suspends the $31.4 trillion debt ceiling until January 1, 2025, allowing the U.S. government to pay bills.
instead defenseless Discretionary spending White House officials said the current level in 2024 would be “broadly flat” “given the agreed spending adjustments.”
They estimate that total nondefense discretionary spending, excluding veterans’ benefits, will total $637 billion in fiscal 2024, down slightly from $638 billion the year before. This total also he will increase by 1% in 2025.
A breather for the 2024 election
The debt ceiling extension will continue beyond 2024, so Congress won’t have to re-engage deeply polarized issues until after the November 2024 presidential election.
Still, there will need to be tough debates in Congress this year about how to allocate funds under the new spending cap.
Increased defense spending
The deal would increase total defense spending to $886 billion, consistent with Biden’s policies. 2024 budget Spending suggestion.
This is about a 3% increase over the current budget of $858 billion allocated to other defense-related programs at the Department of Defense and other government agencies.
IRS special fund transfers
Biden and Democrats Secure $80 billion Last year’s Control Inflation Act provided a decade of new funding to help the Internal Revenue Service enforce America’s wealthy tax laws, which will help the administration save $200 billion over the next decade. It is expected to bring in additional revenue.
IRS specified the money It was due to hiring thousands of new agents, and the additional tax revenue they generated was expected to offset the many climate-friendly tax credits.
The new legislation and ensuing spending will see $10 billion out of the Internal Revenue Service’s funds in calendar years 2024 and 2025, respectively. But government officials believe the IRS has been funded for 10 years and will be able to make ends meet in the short term.
covid clawback
Biden and McCarthy agreed to recover much of the unspent coronavirus relief fund as part of a budget deal. Estimates of unspent funds are between $50 billion and $70 billion.
White House officials said some funds would be reserved, including items related to vaccine funding, housing assistance and aid to indigenous peoples.
work requirements
Biden and McCarthy fought hard to impose tougher working conditions on low-income Americans targeted for food and health programs.
Although the deal made no changes to Medicaid, it did allow some low-income people receiving food assistance under a program known as SNAP to start working until age 54 instead of age 50. will impose requirements.
student loan
The new bill would require the Biden administration to pursue a plan to end the current student loan moratorium by the end of August.
“Paygo”
Republicans have secured a budgeting mechanism known as “Paygo” (short for pay-as-you-go), saying that new agency actions that affect revenues and spending should be offset by savings.
But the law would give Biden’s budget secretary an opportunity to waive that requirement, and would also limit judicial review of decisions.
energy allowed
Biden and McCarthy agreed on new rules to make it easier to obtain permits for energy projects, including those based on fossil fuels. McCarthy and his Republicans made permitting reform one of the pillars of any deal, and the White House scrapped the deal. support The plan at the beginning of this month was delayed.
