Budget negotiators close on debt, agency spending deal

WASHINGTON (AP) — The Trump administration and House Speaker Nancy Pelosi are on the cusp of the critical debt and budget deal, one that would amount to an against-the-odds victory for Washington pragmatists seeking to avoid politically dangerous tumult over must-do fiscal deadlines.

Aides on both sides of the talks say the tentative deal would restore the government's ability to borrow to pay its bills into the next administration and build upon recent large budget gains for both the Pentagon and domestic agencies. The deal would mostly eliminate the risk of a repeat government shutdown this fall.

The agreement on an outline for $1.3 trillion in agency spending would represent a win for lawmakers eager to return Washington to a more predictable path amid political turmoil and polarization, defense hawks determined to cement big military increases and Democrats seeking to protect domestic programs. Nobody can claim a big win but both sides view it as better than a protracted battle this fall that probably wouldn't end up much differently.

The aides who spoke about the emerging deal did so on the condition of anonymity because they were not authorized to speak on the record before a deal was final. A person close to the talks said final obstacles are down to technical issues.

A push by the White House and House GOP forces for new offsetting spending cuts was largely jettisoned, though Pelosi, D-Calif., has given assurances about not seeking to use the follow-up spending bills as vehicles for aggressively liberal policy initiatives.

Fights over President Donald Trump's U.S.-Mexico border wall, other immigration-related issues and spending priorities will be rejoined on follow-up spending bills that are likely to produce much the same result on such fights as current law. The House has passed most of its bills, using far higher levels for domestic spending. Senate measures would follow this fall, with levels reflecting the accord.

At issue are two separate but pressing items on Washington's must-do agenda: increasing the debt limit to avert a first-ever default on U.S. payments and acting to set overall spending limits and prevent automatic spending cuts from hitting the Pentagon and domestic agencies in January.

The threat of the automatic cuts represented the last gasp of a failed 2011 budget and debt pact between former President Barack Obama and then-Speaker John Boehner, R-Ohio, that promised future spending and deficit cuts to cover a $2 trillion increase in the debt. But a bipartisan deficit "supercommittee" failed to deliver and lawmakers were unwilling to live with the follow-up cuts to defense and domestic accounts. This is the fourth deal since 2013 to reverse those cuts.

Prospects for an agreement, a monthslong priority of top Senate Republican Mitch McConnell, R-Ky., became far brighter when Pelosi returned to Washington this month and aggressively pursued the pact with Treasury Secretary Steven Mnuchin, who was anointed lead negotiator instead of more conservative options like acting White House Chief of Staff Mick Mulvaney or hard-line budget director Russell Vought.