Democrats, GOP announce $1.59 trillion spending deal to avert government shutdown

House Republicans, led by Speaker Mike Johnson (R-La.), and Senate Democrats, under the guidance of Senate Majority Leader Chuck Schumer (D-N.Y.), have successfully reached a federal spending agreement on Sunday, a move that comes amid looming threats of a government shutdown. President Joe Biden, along with congressional leaders, endorsed the bipartisan pact.

This agreement adheres closely to the spending caps established by Congress for both defense and domestic programs, as outlined in the bill that suspended the debt limit until 2025. Despite this adherence, concessions have been made to address concerns from House Republicans who deemed the initial spending restrictions inadequate.

President Biden expressed his approval, stating, “The bipartisan funding framework… moves us one step closer to preventing a needless government shutdown and protecting important national priorities.” Emphasizing the rejection of deep cuts to crucial programs, Biden highlighted the agreement’s potential to pave the way for comprehensive funding bills, free from extreme policies.

The proposed spending package amounts to $1.59 trillion, with $886 billion allocated for defense priorities and $704 billion designated for non-defense programs. House Speaker Mike Johnson, in a letter to colleagues, asserted that the agreement secures an additional $16 billion in spending cuts, marking a significant reduction compared to the previous deal brokered by former Speaker Kevin McCarthy and President Biden.

Describing it as the most favorable budget agreement for Republicans in over a decade, Speaker Johnson indicated that the proposed spending is approximately $30 billion less than what the Senate had been contemplating. Senate Minority Leader Hakeem Jeffries and Majority Leader Schumer jointly stated that the deal would safeguard vital domestic priorities, such as veterans’ benefits, health care, and nutrition assistance.

The agreement expedites the realization of around $20 billion in cuts for the Internal Revenue Service, while also rescinding approximately $6 billion in unspent COVID relief funds. With funding set to lapse on January 19 for some agencies and February 2 for others, lawmakers aimed to secure an agreement on overall spending levels, enabling appropriators to draft detailed funding bills for agencies.

Importantly, this spending deal remains distinct from concurrent negotiations addressing additional funding for Israel and Ukraine, alongside efforts to alleviate restrictions on asylum claims at the U.S. border.