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President Trump’s Surprising Debt Deal

Thursday September 7th, 2017   •   Posted by Craig Eyermann at 6:59am PDT   •  

56290342 - illustration of politicians making deal for a vote with taxpayer money While it won’t be news to MyGovCost readers, President Trump did indeed tie together aid to fund the recovery to large-scale damage caused in Texas and Louisiana by Hurricane Harvey with an increase in the U.S. government’s statutory debt ceiling.

What may be surprising however is who he reached the deal to do both things with in the U.S. Congress. Reuters has the story:

WASHINGTON/ABOARD AIR FORCE ONE (Reuters) – President Donald Trump forged a surprising deal with Democrats in Congress on Wednesday to extend the U.S. debt limit and provide government funding until Dec. 15, embracing his political adversaries and blindsiding fellow Republicans in a rare bipartisan accord.

Trump, living up to his reputation for unpredictability, met at the White House with congressional leaders from both parties and overruled Republicans and U.S. Treasury Secretary Steven Mnuchin, who wanted a longer-term debt-limit extension rather than the three-month Democratic proposal the president embraced.

“We could have done a one-year deal today,” Mnuchin told reporters aboard Air Force One later in the day en route back to Washington from an event in North Dakota where Trump spoke about taxes.

Mnuchin said Trump chose a short-term deal to keep his options open on possibly raising military funding later this year, suggesting a longer-term government funding deal might have blocked that.

The increase in military spending that Trump will be seeking later in the year is primarily related to addressing rising geopolitical tensions with North Korea, which has launched a series of ballistic missile tests with increasing frequency and conducted an underground explosion of a new nuclear weapon in recent weeks.

Given the nature of the deal, where the $7.9 billion package of aid for disaster relief and the increase in the debt ceiling was tied to the READ Act, Americans can now expect that federal government spending will be allowed to increase at a faster rate than what President Trump has previously proposed in the absence of effective, unified political opposition by advocates of greater fiscal responsibility in Washington D.C.

Not to mention more capable leadership on the parts of those who suddenly found themselves sidelined by President Trump’s move.

Update: After this article was written, the amount of hurricane relief funds provided by the bill was increased to $15 billion in the Senate and the debt ceiling suspended through December 15, 2017. President Trump signed the bill on Friday, September 8, 2017.

Given the path that Hurricane Irma took along the west coast of Florida over the weekend, President Trump’s decision to sign off on the Congress’ larger package of hurricane relief aid appears to be prudent.

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September 2017