US debt ceiling deal: what’s in and out of Biden and McCarthy’s agreement

theguardian.com:

Details of the deal between Joe Biden and Kevin McCarthy take the form of a 99-page bill that would suspend the nation’s debt limit into 2025 in order to avoid an unprecedented federal default, which the White House said on Monday would be “catastrophic for the American people”, while limiting government spending.

The Democratic president and Republican House speaker are trying to win over lawmakers to the plan in time to avert a default that would shake the global economy. But Congress will be scrutinizing and debating the legislation fiercely this week.

McCarthy said the House will vote on the legislation Wednesday, giving the Senate time to consider it before 5 June, the date when the treasury secretary, Janet Yellen, said the US could default on its debt obligations if lawmakers did not act in time.

With the details of the deal now clear, here’s what’s in and out:

The agreement would keep non-defense spending roughly flat in the 2024 fiscal year and increase it by 1% the following year, as well as suspend the debt limit until January 2025 – past the next presidential election.

For the next fiscal year, the bill matches Biden’s proposed defense budget of $886bn and allots $704bn for non-defense spending. It also requires Congress to approve 12 annual spending bills or face a snapback to spending limits from the previous year, which would mean a 1% cut.

Overall, the White House estimates that the plan would reduce government spending by at least $1tn, but official calculations have not yet been released.

The agreement would fully fund medical care for veterans at the levels included in Biden’s proposed 2024 budget blueprint, including a fund dedicated to veterans who have been exposed to toxic substances or environmental