The details of a debt limit deal agreed to by congressional leaders and the White House became public Sunday evening. According to John Boehner's office, the first $900 billion debt limit increase is tied to $917 billion in discretionary spending cuts over 10 years.
The second debt limit hike of $1.5 trillion will occur if either (a) a balanced budget amendment is passed by Congress and sent to the states for ratification or (b) Congress passes a $1.5 trillion deficit reduction package recommended by a special committee.*
If Congress neither passes a balanced budget nor the special committee's cuts, across the board spending cuts would occur. "Total reductions would be equally split between defense and non-defense programs. Across-the-board cuts would also apply to Medicare," according to Boehner's office. "Other programs, including Social Security, Medicaid, veterans, and civil & military pay, would be exempt."
Here are excerpts from John Boehner's telephone call with the House GOP conference tonight:
“The press has been filled with reports all day about an agreement. There’s no agreement until we’ve talked to you. There is a framework in place that would cut spending by a larger amount than we raise the debt limit, and cap future spending to limit the growth of government. It would do so without any job-killing tax hikes. And it would also guarantee the American people the vote they have been denied in both chambers on a balanced budget amendment, while creating, I think, some new incentives for past opponents of a BBA to support it.”
“My hope would be to file it and have it on the floor as soon as possible. I realize that’s not ideal, and I apologize for it. But after I go through it, you’ll realize it’s pretty much the framework we’ve been operating in.”
“Since Day One of this Congress, we’ve gone toe-to-toe with the Obama Administration and the Democrat-controlled Senate on behalf of our people we were sent here to represent.”
“Remember how this all started: the White House demanded a “clean” debt limit hike with no spending cuts and reforms attached. We stuck together, and frankly made them give up on that.”
“Then they shifted to demanding a “balanced” approach – equal parts spending cuts and tax hikes. With this framework, they’ve given up on that, too.”
“I’m gonna tell you, this has been a long battle – we’ve fought valiantly – and frankly we’ve done it by listening to the American people. And as a result, our framework is now on the table that will end this crisis in a manner that meets our principles of smaller government.”
“Now listen, this isn’t the greatest deal in the world. But it shows how much we’ve changed the terms of the debate in this town.”
“There is nothing in this framework that violates our principles. It’s all spending cuts. The White House bid to raise taxes has been shut down. And as I vowed back in May – when everyone thought I was crazy for saying it – every dollar of debt limit increase will be matched by more than a dollar of spending cuts. And in doing this, we’ve stopping a job-killing national default that none of us wanted.”
And here are President Obama's remarks from the White House:
THE PRESIDENT: Good evening. There are still some very important votes to be taken by members of Congress, but I want to announce that the leaders of both parties, in both chambers, have reached an agreement that will reduce the deficit and avoid default -- a default that would have had a devastating effect on our economy.
The first part of this agreement will cut about $1 trillion in spending over the next 10 years -- cuts that both parties had agreed to early on in this process. The result would be the lowest level of annual domestic spending since Dwight Eisenhower was President -- but at a level that still allows us to make job-creating investments in things like education and research. We also made sure that these cuts wouldn’t happen so abruptly that they’d be a drag on a fragile economy.