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September 06, 2017 at 11:56 AM
President Donald Trump sided with Democrats on adding a three-month extension of the U.S. debt limit and government spending to a hurricane-relief bill over the arguments of fellow Republicans, who pressed for a longer debt extension.
Trump, after meeting with congressional leaders Wednesday at the White House, told reporters on Air Force One that the deal with Democrats would be “very good.”
“We agreed to a three-month extension on debt ceiling, which they consider to be sacred — very important — always we’ll agree on debt ceiling automatically because of the importance of it,” the president said.
Senate Majority Leader Mitch McConnell told reporters he’ll add the spending and debt-limit extensions to the Hurricane Harvey relief package passed by the House earlier in the day. He said he will support the measure.
“The president agreed with Senator Schumer and Congresswoman Pelosi to do a three-month CR and debt ceiling until December,” said McConnell, a Kentucky Republican. “His feeling was that we needed to come together to not create a picture of divisiveness at a time of genuine national crisis.” CR is shorthand for a stopgap government spending bill.
Just hours earlier, House Speaker Paul Ryan of Wisconsin — who was in the meeting with Trump — had told reporters the Democratic proposal was “unworkable” and “ridiculous.”
The agreement sets up what could be a major fight in December over government funding, Trump’s proposed border wall with Mexico and Trump’s decision to end a program that lets young undocumented immigrants stay in the U.S., as well as perhaps the debt ceiling.
Treasury Bills
The plan would extend the U.S. debt limit and provide funds to keep the government running through Dec. 15, Senate Democratic leader Chuck Schumer of New York and House Democratic leader Nancy Pelosi of California said in a joint statement.
While rates on Treasury bills maturing around the previous late-September debt-limit deadline outlined by Treasury Secretary Steven Mnuchin plunged, they surged on securities coming due around mid-December, suggesting Wall Street sees more legislative strife ahead. The yield on Treasury bills maturing Dec. 14 rose by about eight basis points, to 1.046 percent.
“Both sides have every intention of avoiding default in December and look forward to working together on the many issues before us,” Schumer and Pelosi said in their statement.
Later, Schumer told reporters, “We thought for the good of the country we should make the right offer and we did, and we’re very glad the president accepted it.”
Conservative groups criticized the deal, saying it weakens the hands of Republicans by giving Democrats more power over a spending bill at the end of the year. Creating a fiscal and debt deadline just before the holidays pressures lawmakers to vote for a deal to get home to their families, they said.
