Treasury Secretary Steven Mnuchin said Thursday that a comprehensive two-year budget deal has been reached on fiscal 2020 and fiscal 2021 spending levels, including a two-year debt limit extension, Roll Call reported.
“The good news is we’ve reached an agreement between the administration, the House and the Senate on topline numbers for both year one and year two,” Mnuchin said on CNBC’s “Squawk Box” program.
“We’re now discussing offsets as well as certain structural issues. And we’ve agreed as part of that deal there would be a long-term, two-year debt ceiling increase.”
Mnuchin also said that congressional leaders and the administration have agreed the spending cap increases will be offset by cuts elsewhere.
“We’ve agreed that there will be offsets, so now we’re just trying to figure out whether we can get both the number agreed to in time and the specifics and a structure,” Mnuchin said.
Reaching a comprehensive spending deal that includes lifting the debt limit has pressed Washington as it seeks to avoid a potential government default as early as late August, as well as a potential government shutdown and mandatory spending cuts on Oct. 1, as On Base has reported.
If a deal to raise current spending caps is not reached before October, approximately $71 billion in across-the-board defense cuts would be initiated through sequestration.
Agreement on spending offsets appear to remain an obstacle as a senior administration official said Wednesday it seeks at least $150 billion in offsets, according to the Roll Call report.
A previous bipartisan budget deal enacted in February 2018 counters that target, including just $38 billion in offsets for $296 billion in increased spending, the report stated.
Mnuchin did not offer a deal timeline, but said he’s confident agreement can be reached, the report said.
House Speaker Nancy Pelosi (D-Calif.) cast doubt that a final deal had been reached, but didn’t dispute that talks were advancing, CQ reported.
“Nothing is agreed to until everything is agreed to,” she said at the Capitol. “But we are on our way. We have a path.”
Senate Majority Leader Mitch McConnell (R-Ky.) said Thursday he was optimistic for a final deal Republicans could support, emphasizing the need to avoid military cuts.
“We don’t want to send defense in the wrong direction,” McConnell told the Fox Business Network.
DOD photo by U.S. Army Sgt. Amber Smith