President Joe Biden and House Speaker Kevin McCarthy reached the final agreement in principle on Sunday on a deal to raise the country’s debt ceiling.
Biden and McCarthy came to an agreement on Saturday as Congress and the White House took a bipartisan approach to the debt ceiling in order to prevent the default.
“The agreement prevents the worst possible crisis, a default, for the first time in our nation’s history,” Biden said at the White House. “Takes the threat of a catastrophic default off the table.”
In the new deal also requires working hours for federal assistance programs that include the Supplemental Nutritional Assistance Program (SNAP), the food stamps program.
Spokesperson for the White House, Michael Kikukawa, said Biden voted a program in 1990s, in the U.S. Senate, that was similar that McCarthy had proposed in negotiations.
Former President Bill Clinton signed the Welfare To Work bill, also know Personal Responsibility and Work Opportunity Reconciliation Act, that would lead those who were on welfare getting back into the workforce.
“No one got everything they want,” Biden added. “But that’s the responsibility of governing. So I strongly urge both chambers to pass that agreement.”
He said the negotiating teams will finalize the legislative text over the next few days. The agreement will then go to the House and Senate.
Bloomberg reported Biden’s cabinet members had made individual lobbying calls to at least 60 House Democrats by early Monday morning.
With the tentative debt deal, the bond market’s concerns seem to have shifted from the possibility of default to the deluge of Treasury Bills expected to hit the market.
The Treasury Department is expected to soon replenish its coffers by selling more than $1 trillion of bonds through the end of the third quarter.
Once the final agreement gets all the nods, it would raise the borrowing limit for two years, past the 2024 election, and will be able to curb government spending during that time, the Wall Street Journal reported.
House Republicans posted the bill on Sunday, setting up a House vote on Wednesday, May 31. WSJ reported that GOP leaders plan to honor a commitment to ensure lawmakers have 72 hours to review the text before a vote.
Earlier this month, Treasury Department’s measures to help keep the government’s bills paid have declined to $88 billion from $110 billion.
The department said that just over a quarter of the $333 billion of authorized measures are still available to keep the government from reaching the statutory debt limit.
Treasury Secretary Janet Yellen had earlier said that the government is at risk of running out of headroom as soon as June 1 and that the department may be unable to meet the government’s obligation.
Produced in association with Benzinga
Edited by Alberto Arellano and Joseph Hammond