Congress secures short-term deal for Harvey relief & debt, sets up big fight for December

Senate Republicans led by Mitch McConnell announce their support for a short-term government spending bill and temporary increase in the debt ceiling combined with $8 billion in Hurricane Harvey relief. September 6, 2017 (Credit: Sinclair Broadcast Group)

By the end of the week, both the House and Senate aim to have a bill signed by the president providing the first installment of cash for Hurricane Harvey victims on top of a short-term government spending bill and debt limit increase.

The House and Senate leadership met on Wednesday afternoon with President Donald Trump to shore up the agreement, which came as a surprise to some Republicans who denounced the proposal earlier in the day as "ridiculous" and "unworkable."

Senate Majority Leader Mitch McConnell (R-Ky.) announced during a press conference that Republicans, Democrats and the White House agreed to support the $7.85 billion Hurricane Harvey relief bill passed earlier in the day by the House, if it is rolled into a package that includes a three-month continuing resolution to fund the government and a temporary increase in the debt ceiling. The latter two measures will expire on December 15.

McConnell explained that all sides were willing to reach a compromise because of the magnitude of the crisis now facing the U.S. government.

By the end of the week, the Treasury estimates it could exceed the federal borrowing limit. The Federal Emergency Management Agency (FEMA) is expected to run out of funds to help Harvey victims and prepare for Hurricane Irma by Friday or Saturday. And by the end of September, Congress must pass a spending bill or face a government shutdown.

"If this isn't the definition of an emergency, I don't know what is," McConnell said, announcing the Senate would wrap all three measures into one package and send it back to the House.

Sen. John Barrasso (R-Wy.) made it clear that the Senate aims to have the package on the president's desk and signed by the end of the week. "It needs to get done this week," he emphasized.

The Senate GOP leadership has not yet scheduled a time for the vote, but House leaders said that they will stay in session until they get a relief bill to provide urgently needed funding to FEMA and Harvey victims.

The House took one step in that direction earlier in the day passing nearly $8 billion of initial Harvey relief money in an overwhelming bipartisan vote of 419 to 3. Based on current estimates, the total cost of recovery for Texas and parts of Louisiana will exceed $100 billion.

Before the House voted to approve the relief, there were already signs that Republicans in the House were split on how to approach disaster relief, which many anticipated would be paired with an increase in the federal borrowing limit.

Fiscal conservatives wary of piling untold billions onto the U.S. debt expressed their preference for the short-term three-month suspension of the debt ceiling being offered by Democrats. The GOP leadership, on the other hand, hoped to shore up a long-term fix, lifting the debt limit for 18 months and avoiding a new fiscal showdown in December.Before the meeting with Donald Trump, House Speaker Paul Ryan (R-Wis.) denounced the short-term fix proffered by House and Senate Democrats to shore up emergency relief and put off a government shutdown and debt default.

"I think that's ridiculous and disgraceful," Ryan stated. "We've got all this devastation in Texas, we've got another unprecedented hurricane about to hit Florida and they want to play politics with the debt ceiling."

The urgency of the situation has pushed a number of lawmakers into a position to compromise.

McConnell said the president agreed to the Democrats' request in order "not to create a picture of divisiveness at a time of genuine national crisis."

Sen. Schumer applauded the compromise, saying the deal represented "a good moment of some bipartisanship." He added that Democrats made the right offer "and we're very glad the president accepted it."

As Congress reconvened after their long August recess, it was clear to lawmakers on both sides of the aisle that there was a lot of heavy lifting to do in September. Based on the new plan, much of that work will happen this week.

"There are concerns about FEMA running out of money this weekend and that's why we're going to stay in session and not leave town until we get the $8 billion enacted into law," Rep. Lamar Smith (R-Texas) said.

As of July 31, FEMA had only $3.8 billion in its Disaster Relief Fund. If Congress fails to pass the full package that the Senate is now attaching to relief funds, it could impact more than just Texas and Louisiana.

On Tuesday, President Trump preemptively signed emergency declarations for Florida, Puerto Rico and the U.S. Virgin Islands, territories that are all in the path of Hurricane Irma. The Category 5 hurricane is expected to touchdown in Florida on Friday or Saturday and FEMA needs the resources to preposition and prepare for the monster storm.

On top of an aggressive hurricane season, the western states are battling wildfires that have already consumed one million acres. FEMA is responding to statewide fire emergencies declared for Washington State, Oregon, California, Idaho, Utah and Montana.

This series of emergencies has oddly enough produced an outcome that many House Republicans find preferable.

Rep. Tom Cole (R-Okla.), a ranking member on the Budget and Appropriations Committees, insisted that he would not support the long-term suspension of the debt ceiling that the Republican leadership and Trump's Treasury Secretary were pushing.

"I don't think you blackmail people into doing it," Cole said of pairing a long-term debt increase with disaster relief.

He added that anything more than a three-month extension "would have a lot more difficulty" getting passed through the Republican-controlled Congress. A short-term measure combined with a continuing resolution, he said, is virtually guaranteed passage.

"You got dozens of Democrats prepared to vote for it. You got the president wanting it. So frankly I'm more worried about people just going willy-nilly into debt without thinking about it," Cole explained.

A similar sentiment was also expressed by Rep. Mark Meadows (R-N.C.), leader of the 30-plus deficit hawks in the House Freedom Caucus. He hasn't yet committed to vote for the Senate version of the bill, but he drew a red line saying "if it comes back just with Harvey relief and a $2 trillion debt ceiling, I won't be able to support it."

The deal struck at the White House this afternoon has significant bipartisan momentum at the moment. However, it is entirely unclear how the political landscape will look in December when the threat of a debt default and government shutdown returns.

The political goodwill garnered in the wake of Hurricane Harvey could give way to the more pragmatic concerns about out-of-control government spending, especially as additional aid packages are needed. A new demand from President Trump to fund the controversial border wall, or a host of other challenges could also crop up in the coming months.

The short-term plan to provide disaster relief, fund the government and pay the debt provides a short-term fix. It also clearly sets up a number of obstacles for Republicans and potential leverage for Democrats when Congress is forced to revisit the politically divisive issues three months down the road.

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