U.S. Senate Majority Leader Mitch McConnell (left) chats with Senate Minority Leader Chuck Schumer in October. The two negotiated a budget agreement that marks a major breakthrough for a Congress still reeling from a partial government shutdown last month.

Credit: Alex Wong

Senators Reach Two-Year Budget Deal

February 7, 2018

Updated at 2:25 p.m. ET

Senate leaders have reached a bipartisan budget agreement to increase military and domestic spending levels for two years, paving the way for the first long-term spending pact since President Trump took office.

According to congressional sources briefed on the deal, the plan eliminates mandatory spending cuts for two years and increases Pentagon spending by $80 billion and domestic spending by $63 billion for the 2018 fiscal year. In the 2019 fiscal year, defense spending would rise by $85 billion and domestic spending by $68 billion.

The agreement, negotiated by Senate Majority Leader Mitch McConnell and Senate Minority Leader Chuck Schumer, marks a major breakthrough for a Congress still reeling from a partial government shutdown last month.

"No one would suggest it's perfect, but we worked hard to find common ground," said McConnell, as he announced the agreement on the Senate floor.

"This budget deal is a genuine breakthrough," said Schumer, who said the agreement would "break the long cycle of spending crises."

The deal also suspends the debt ceiling, which the federal government had been due to reach within the next month, until March 2019.

A long-term spending agreement had long been sought by military leaders, who said a series of short-term funding bills had harmed military readiness.

"I cannot overstate the negative impact to our troops and families' morale from all this budget uncertainty," said Defense Secretary James Mattis at the daily White House briefing. "Today's congressional action will ensure our military can defend our way of life, preserve the promise of prosperity and pass on the freedoms you and I enjoy to the next generation."

A final vote on the budget deal is likely by Friday, which means lawmakers would have to pass a one- or two-day spending bill to keep the government open past the Thursday funding deadline.

The bill will also include at least $80 billion in disaster relief spending for victims of hurricanes and wildfires in Texas, California, Florida and Puerto Rico.

All told, the Republican-controlled Congress is on track to approve about $400 billion in new spending over next two years, just months after enacting a nearly $1.5 trillion tax cut. The agreement would create bicameral commissions on budget reform and pension reform to report back to Congress by the end of the year.

The next challenge will be for McConnell and Schumer to persuade a majority of House members to back the same proposal in the next few days.

They got crucial support from House Speaker Paul Ryan, who laid out the terms of the deal to House Republicans in a closed-door meeting. In a statement, Ryan said, "This agreement delivers on our commitment to fully fund our national defense — no more short-term ploys and patches."

Conservatives began mobilizing against the spending increases contained in the agreement as soon as it was announced.

"The country cannot afford an irresponsible plan that welcomes back trillion-dollar deficits with open arms. Congress should reject this deal," said Justin Bogie, a senior policy analyst with the influential conservative Heritage Foundation.

In addition, House Democrats, led by Minority Leader Nancy Pelosi, D-Calif., are staging a protest of the budget deal on the House floor Wednesday because there has been no progress on an immigration deal.

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