Massive Spending Deal Brings Government Shutdown to an End

Massive Spending Deal Brings Government Shutdown to an End

iStockphoto/The Fiscal Times

President Donald Trump signed a major budget plan into law Friday, ending the year's second government shutdown hours after it started.

Both chambers of Congress passed a short-term funding bill in the wee hours of Friday and cleared the way for a massive boost to military and domestic spending hours after funding lapsed at midnight. The government partially shut down for the second time in less than a month.

The massive legislation cleared Congress after opposition delayed or threatened its passage in both chambers. The House narrowly passed the budget bill by 240 to 186 before dawn Friday, then sent it to Trump.

Trump tweeted Friday morning that he signed the legislation.

"Just signed Bill. Our Military will now be stronger than ever before," the president wrote. "We love and need our Military and gave them everything — and more. First time this has happened in a long time. Also means JOBS, JOBS, JOBS!"

Both conservative and liberal lawmakers mounted resistance to the plan. Some GOP conservatives objected to increased spending and argued that it would recklessly increase budget deficits. Meanwhile, House Minority Leader Nancy Pelosi and other Democrats criticized the lack of a provision to protect hundreds of thousands of young immigrants from deportation.

Early Friday, the Senate approved the measure by a 71-28 vote following Sen. Rand Paul's repeated attempts to block the vote. The Kentucky Republican opposed the spending increases contained in the agreement and wanted to vote on an amendment to maintain budget caps.

The bill sets up a two-year, $300 billion boost in spending on military and domestic programs. It also extends the debt ceiling, authorizes nearly $90 billion more in aid for last year's string of natural disasters, gives funding to fight the opioid crisis and extends the popular Children's Health Insurance Program for an additional four years.

Treasury Secretary Steven Mnuchin applauded the bill's passage, as it extends the government's borrowing authority until March 2019. He had warned that the Treasury would lose the ability to borrow soon if Congress did not extend the debt limit.

Trump, who said earlier this week he would "love" a government shutdown, later signaled his support for the bipartisan deal.

"The Budget Agreement today is so important for our great Military," Trump wrote in a Wednesday tweet. "It ends the dangerous sequester and gives Secretary Mattis what he needs to keep America Great. Republicans and Democrats must support our troops and support this Bill!"

In a statement Friday morning, House Speaker Paul Ryan called the budget deal "a great victory" for military service members.

"Ultimately, neither side got everything it wanted in this agreement, but we reached a bipartisan compromise that puts the safety and well-being of the American people first," he said.

The legislation funds the government through March 23 while lawmakers work on an appropriations bill with the levels set out by Congress. Congress will then have to pass appropriations legislation for the current fiscal year that ends Sept. 30 and the following year.

The deal includes:

  • A $165 billion increase in military spending;
  • A $131 billion boost to domestic program spending;
  • Nearly $90 billion in funding for disaster relief efforts in Texas, Florida and Puerto Rico;
  • Two years of funding for community health centers;
  • Another four-year extension of the Children's Health Insurance Program, for a total of a decade;
  • Funding for existing infrastructure programs related to transportation, drinking water and broadband.

The budget deal's passage faced real threats on Wednesday and Thursday. Pelosi said she would vote against the bill unless Ryan gave assurances that he would allow an open debate on immigration legislation. Other Democrats followed suit.

Self-professed fiscal hawks in the House also opposed the bill. The nonpartisan Congressional Budget Office estimated Thursday that it would cost about $320 billion. Most of that would come in the first year.

Similar concerns surfaced Thursday in the Senate, as several fiscal hawks voted against it. Paul mounted the most serious opposition, leading Senate Majority Whip John Cornyn to say he would "effectively shut down the federal government for no real reason."

"I can't in all good honesty, in all good faith, just look the other way because my party is now complicit in the deficits," Paul said on the Senate floor hours before the chamber voted.

Paul and most of the Republicans who voted against the budget plan supported the massive tax cuts the GOP passed into law late last year. The CBO estimates that the law will add more than $1 trillion to federal budget deficits over a decade, even after economic growth is taken into account.

Path forward on immigration unclear

Though the bill ends a short government shutdown, the fate of immigration legislation is unclear. The Senate will have an open floor process on immigration plans next week, though lawmakers have not expressed optimism about crafting a plan that can get 60 votes.

Even if the Senate passes its own plan, it is unclear if it can garner the votes needed to clear the more conservative House.

Ryan committed to bringing up an immigration bill, but only after the budget agreement passed. He did not meet Pelosi's demands, as he reiterated that he will bring up a bill "that the president will sign."

"Democrats worked hard to achieve a bipartisan agreement and gave our assurances to the Speaker that we were not interested in shutting down government," Pelosi said in a statement after the vote. "In return, the Speaker refused to make a real commitment to schedule a vote to protect the Dreamers who have the overwhelming support of the American people and a bipartisan majority in the House."

Drafting a plan that meets Trump's demands and appeases Democrats could prove difficult. Trump has called for stricter limits on extended family migration, an end to the visa "lottery" system and a wall along the Mexican border, which the minority party has opposed.

This article originally appeared on CNBC. Read more from CNBC:

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