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Mnuchin says budget deal with Pelosi is 'very close'

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Mnuchin says budget deal with Pelosi is 'very close'
News

News

Mnuchin says budget deal with Pelosi is 'very close'

2019-07-16 06:11 Last Updated At:06:20

It's House Speaker Nancy Pelosi and top Senate Republican Mitch McConnell vs. hardliners in the White House as lawmakers pursue a deal on federal spending and the debt. And the hardliners, wary of further increases to federal spending, appear to be losing.

Talks between Pelosi and Treasury Secretary Steven Mnuchin appear to be progressing. Mnuchin on Monday told reporters, "I think we're very close to a deal," though he cautioned that "these deals are complicated."

Mnuchin says increasing the $22 trillion debt limit needs to be done this month to avert any risk of a U.S. default on obligations like bond payments. He said he doesn't think there will be a government shutdown when the budget year ends Sept. 30, nor does he think "either party or anybody wants to put the credit of the United States government at risk."

Treasury Secretary Steve Mnuchin speaks during a news briefing at the White House, in Washington, Monday, July 15, 2019. (AP PhotoCarolyn Kaster)

Treasury Secretary Steve Mnuchin speaks during a news briefing at the White House, in Washington, Monday, July 15, 2019. (AP PhotoCarolyn Kaster)

Previous negotiations toward a budget deal had included White House conservatives like Acting Chief of Staff Mick Mulvaney. But Mnuchin is taking the lead for the administration in the talks with Pelosi, as the speaker doesn't have a productive relationship with Mulvaney.

Mnuchin and Pelosi were slated to talk again later Monday, according to a Pelosi spokesman.

The talks increasingly hinge on a durable, powerful and familiar political coalition: GOP defense hawks demanding bigger Pentagon budgets and Democrats seeking equal treatment for domestic priorities.

Three previous fiscal deals over the past years, conducted when Democrats were in the House minority, were greased by lawmakers' appetite for both guns and butter — to the dismay of deficit hawks relegated to Washington's endangered species list. Now, after winning back the House, Pelosi has greater leverage, especially because of the need to increase the government's borrowing cap.

"We gave them an obscene amount of money just two years ago," said Hazen Marshall, a former Senate GOP budget and leadership aide. "And now they want more on top of that. There's a never-ending desire to keep on ramping it up."

Lawmakers are negotiating an increase to spending "caps" for federal agency budgets, along with separate must-do legislation to increase the government's debt limit. The negotiations are opaque, but appear to be guided by the concept of "parity" in spending increases for defense and nondefense agency budgets, based on a public exchange of letters between Mnuchin and Pelosi over the past few days.

The duo of Pelosi, D-Calif., and McConnell, R-Ky., is a partnership of necessity. The two have a chilly but professional relationship and their interests rarely align. But when they team up — as they did on a government spending deal in February — they are virtually unstoppable. Both have long histories with Capitol Hill's appropriations process, the painstakingly bipartisan and pragmatic job of annually divvying up the one-third of the federal budget allocated by Congress each year.

Pelosi's mandate is to increase, as much as possible, the portion of the federal pie going to Democratic priorities such as health care, education, housing and the environment.

McConnell played a key behind-the-scenes role in setting up the negotiations and has encouraged Mnuchin's central role. He wants a deal that would satisfy his defense hawks and his pragmatic-minded power base on the Appropriations Committee. He also knows that the path to a successful deal goes through Pelosi and is likely to include more money than Mulvaney, a former tea party lawmaker, would like.

The alternatives to a deal are distasteful to both sides, and include freezing spending at current levels and operating most of the government essentially on autopilot under a measure known as a continuing resolution. That prospect, talked up behind the scenes by Mulvaney and his allies, is alarming to GOP lawmakers focused on Pentagon policy, who say it would harm military readiness, hurt efforts to relieve procurement shortfalls and scramble long-term Pentagon budget strategies.

The negotiations are closely held but a key concern for Pelosi is getting $22 billion over the next two years to cover the rapidly-growing cost of privately-provided veterans health care. She sent a letter to Mnuchin on Saturday night agreeing with his request to increase the debt limit but pushing for relief for the Veterans Administration's private health care program, which threatens to squeeze other domestic priorities.

"I wanted to put in writing what our concern was," Pelosi said Monday. "We have an additional initiative that was added, but you can't just take it out of other veterans programs or other programs."

Republicans say those VA costs should be absorbed inside the $600 billion set aside for nondefense agencies.

Pelosi appears to be dropping another demand, a $7 billion carve-out to pay for the U.S. Census.

KYIV, Ukraine (AP) — U.S. Secretary of State Antony Blinken said Tuesday that American military aid on its way to Ukraine will make a “real difference” on the battlefield, as the top diplomat made an unannounced visit to reassure an ally facing a fierce new Russian offensive.

In increasingly intense attacks along the northeastern border in recent days, Moscow’s troops have captured around 100 to 125 square kilometers (about 40 to 50 square miles) of territory that includes at least seven villages, according to open source monitoring analysts. Though most of those villages were already depopulated, thousands of civilians in the area have fled the fighting.

Analysts have called this moment one of the most dangerous for Ukraine since Russia's full-scale invasion in February 2022 — and President Volodymyr Zelenskyy asked Tuesday for more air defense systems to protect civilians under Russian fire in the northeast.

“We know this is a challenging time,” Blinken said in the Ukrainian capital where he met with Zelenskyy. But he added that American military aid is “going to make a real difference against the ongoing Russian aggression on the battlefield.”

The visit comes less than a month after Congress approved a long-delayed foreign assistance package that sets aside $60 billion in aid for Ukraine, much of which will go toward replenishing badly depleted artillery and air defense systems.

Some of that “is now on the way,” Blinken said, and some has already arrived in Ukraine.

Moscow’s renewed offensive in the northeastern region of Kharkiv is the most significant border incursion since the early days of the war — and comes after months when the roughly 1,000-kilometer (620-mile) front line barely budged.

More than 7,500 civilians have been evacuated from the area, according to authorities. The Kremlin’s forces are also expanding their push to the northern border regions of Sumy and Chernihiv, Ukrainian officials say, and Kyiv's outgunned and outnumbered soldiers are struggling to hold them back.

Troops fought street to street on the outskirts of Vovchansk, which is among the largest towns in the Kharkiv area, regional Gov. Oleh Syniehubov said on national television. Two civilians were killed in Russian shelling Tuesday, he said.

The U.N. human rights office said the battles are taking a heavy toll.

“We are deeply concerned at the plight of civilians in Ukraine,” Liz Throssell, spokeswoman for the office of the U.N. High Commissioner for Human Rights, said in Geneva. “In the Kharkiv region, the situation is dire.”

Zelenskyy thanked Blinken for the U.S. aid — but added that more is necessary, including two Patriot air defense systems that are urgently needed to protect Kharkiv.

“The people are under attack: civilians, warriors, everybody. They’re under Russian missiles,” he said.

Artillery, air defense interceptors and long-range ballistic missiles have already been delivered, some of them already to the front lines, said a senior U.S. official traveling with the secretary on an overnight train from Poland who spoke to reporters on condition of anonymity ahead of Blinken’s meetings.

Ahead of the trip, U.S. officials noted that since President Joe Biden signed the aid package late last month, the administration has already announced $1.4 billion in short-term military assistance and $6 billion in longer-term support.

The administration is “trying to really accelerate the tempo” of U.S. weapon shipments, said national security adviser Jake Sullivan.

But delays in U.S. assistance, particularly since the Israel-Hamas war began and has preoccupied top administration officials, have triggered deep concerns in Kyiv and Europe. Blinken, for example, has visited the Middle East seven times since the Gaza conflict began in October. His last trip to Kyiv was in September.

On his fourth trip to Kyiv since Russian troops rolled over the border, Blinken emphasized the United States' support for Ukraine's independence and eventual recovery, according to spokesperson Matthew Miller. The U.S. diplomat and the Ukrainian president also discussed long-term security arrangements and Ukraine's economic welfare.

Blinken was due to give a speech later Tuesday extolling Ukraine’s “strategic successes” in the war. It is intended to complement a Blinken address last year in Helsinki, Finland, deriding Putin for Moscow’s strategic failures in launching the war.

Since the Helsinki speech, however, Russia has intensified its attacks, most noticeably as the U.S. House of Representatives sat on the aid package for months without action, forcing a suspension in the provision of most U.S. assistance. Those attacks have increased in recent weeks as Russia has sought to take advantage of Ukrainian shortages in manpower and weapons while the new assistance is in transit.

Meanwhile, Russian President Vladimir Putin plans to make a two-day state visit to China this week, the Chinese Foreign Ministry said. Beijing has backed Moscow politically in the war and has sent machine tools, electronics and other items seen as contributing to the Russian war effort, without actually exporting weaponry.

“A strong, successful, thriving, free Ukraine is the best possible rebuke to Putin and the best possible guarantor for your future,” Blinken told Zelenskyy in Kyiv.

The senior U.S. official said despite some recent setbacks, Ukraine could still claim significant victories. Those include reclaiming some 50% of the territory Russian forces took in the early months of the war, boosting its economic standing and improving transportation and trade links, not least through military successes in the Black Sea.

The official acknowledged that Ukraine faces “a tough fight” and is “under tremendous pressure” but argued that Ukrainians “will become increasingly more confident” as the new U.S. and other Western assistance begins to arrive.

Associated Press writers Aamer Madhani in Washington, Illia Novikov in Kyiv, Ukraine, and Jamey Keaten in Geneva contributed to this report.

Follow AP’s coverage of the war in Ukraine at https://apnews.com/hub/russia-ukraine

In this photo provided by the Ukrainian Presidential Press Office, Ukraine's President Volodymyr Zelenskyy, fourth left, speaks during a meeting with U.S. Secretary of State Antony Blinken, third right, in Kyiv, Ukraine, Tuesday, May 14, 2024. Blinken arrived in Kyiv on Tuesday in an unannounced diplomatic mission to reassure Ukraine that it has American support as it struggles to defend against increasingly intense Russian attacks. (Ukrainian Presidential Press Office via AP)

In this photo provided by the Ukrainian Presidential Press Office, Ukraine's President Volodymyr Zelenskyy, fourth left, speaks during a meeting with U.S. Secretary of State Antony Blinken, third right, in Kyiv, Ukraine, Tuesday, May 14, 2024. Blinken arrived in Kyiv on Tuesday in an unannounced diplomatic mission to reassure Ukraine that it has American support as it struggles to defend against increasingly intense Russian attacks. (Ukrainian Presidential Press Office via AP)

U.S. Secretary of State Antony Blinken, center, attends a meeting with Ukraine's President Volodymyr Zelenskyy in Kyiv, Ukraine, Tuesday, May 14, 2024. Blinken arrived in Kyiv on Tuesday in an unannounced diplomatic mission to reassure Ukraine that it has American support as it struggles to defend against increasingly intense Russian attacks. (Brendan Smialowski/Pool Photo via AP)

U.S. Secretary of State Antony Blinken, center, attends a meeting with Ukraine's President Volodymyr Zelenskyy in Kyiv, Ukraine, Tuesday, May 14, 2024. Blinken arrived in Kyiv on Tuesday in an unannounced diplomatic mission to reassure Ukraine that it has American support as it struggles to defend against increasingly intense Russian attacks. (Brendan Smialowski/Pool Photo via AP)

In this photo provided by the Ukrainian Presidential Press Office, Ukraine's President Volodymyr Zelenskyy speaks during a meeting with U.S. Secretary of State Antony Blinken in Kyiv, Ukraine, Tuesday, May 14, 2024. Blinken arrived in Kyiv on Tuesday in an unannounced diplomatic mission to reassure Ukraine that it has American support as it struggles to defend against increasingly intense Russian attacks. (Ukrainian Presidential Press Office via AP)

In this photo provided by the Ukrainian Presidential Press Office, Ukraine's President Volodymyr Zelenskyy speaks during a meeting with U.S. Secretary of State Antony Blinken in Kyiv, Ukraine, Tuesday, May 14, 2024. Blinken arrived in Kyiv on Tuesday in an unannounced diplomatic mission to reassure Ukraine that it has American support as it struggles to defend against increasingly intense Russian attacks. (Ukrainian Presidential Press Office via AP)

In this photo provided by the Ukrainian Presidential Press Office, Ukraine's President Volodymyr Zelenskyy, left, greets U.S. Secretary of State Antony Blinken, right, prior to their meeting in Kyiv, Ukraine, Tuesday, May 14, 2024. Blinken arrived in Kyiv on Tuesday in an unannounced diplomatic mission to reassure Ukraine that it has American support as it struggles to defend against increasingly intense Russian attacks. (Ukrainian Presidential Press Office via AP)

In this photo provided by the Ukrainian Presidential Press Office, Ukraine's President Volodymyr Zelenskyy, left, greets U.S. Secretary of State Antony Blinken, right, prior to their meeting in Kyiv, Ukraine, Tuesday, May 14, 2024. Blinken arrived in Kyiv on Tuesday in an unannounced diplomatic mission to reassure Ukraine that it has American support as it struggles to defend against increasingly intense Russian attacks. (Ukrainian Presidential Press Office via AP)

In this photo provided by the Ukrainian Presidential Press Office, Ukraine's President Volodymyr Zelenskyy speaks during a meeting with U.S. Secretary of State Antony Blinken in Kyiv, Ukraine, Tuesday, May 14, 2024. Blinken arrived in Kyiv on Tuesday in an unannounced diplomatic mission to reassure Ukraine that it has American support as it struggles to defend against increasingly intense Russian attacks. (Ukrainian Presidential Press Office via AP)

In this photo provided by the Ukrainian Presidential Press Office, Ukraine's President Volodymyr Zelenskyy speaks during a meeting with U.S. Secretary of State Antony Blinken in Kyiv, Ukraine, Tuesday, May 14, 2024. Blinken arrived in Kyiv on Tuesday in an unannounced diplomatic mission to reassure Ukraine that it has American support as it struggles to defend against increasingly intense Russian attacks. (Ukrainian Presidential Press Office via AP)

In this photo provided by the Ukrainian Presidential Press Office, U.S. Secretary of State Antony Blinken attends a meeting with Ukraine's President Volodymyr Zelenskyy in Kyiv, Ukraine, Tuesday, May 14, 2024. Blinken arrived in Kyiv on Tuesday in an unannounced diplomatic mission to reassure Ukraine that it has American support as it struggles to defend against increasingly intense Russian attacks. (Ukrainian Presidential Press Office via AP)

In this photo provided by the Ukrainian Presidential Press Office, U.S. Secretary of State Antony Blinken attends a meeting with Ukraine's President Volodymyr Zelenskyy in Kyiv, Ukraine, Tuesday, May 14, 2024. Blinken arrived in Kyiv on Tuesday in an unannounced diplomatic mission to reassure Ukraine that it has American support as it struggles to defend against increasingly intense Russian attacks. (Ukrainian Presidential Press Office via AP)

In this photo provided by the Ukrainian Presidential Press Office, Ukraine's President Volodymyr Zelenskyy, left, greets U.S. Secretary of State Antony Blinken, right, prior to their meeting in Kyiv, Ukraine, Tuesday, May 14, 2024. Blinken arrived in Kyiv on Tuesday in an unannounced diplomatic mission to reassure Ukraine that it has American support as it struggles to defend against increasingly intense Russian attacks. (Ukrainian Presidential Press Office via AP)

In this photo provided by the Ukrainian Presidential Press Office, Ukraine's President Volodymyr Zelenskyy, left, greets U.S. Secretary of State Antony Blinken, right, prior to their meeting in Kyiv, Ukraine, Tuesday, May 14, 2024. Blinken arrived in Kyiv on Tuesday in an unannounced diplomatic mission to reassure Ukraine that it has American support as it struggles to defend against increasingly intense Russian attacks. (Ukrainian Presidential Press Office via AP)

U.S. Secretary of State Antony Blinken, center, watches Ukraine's President Volodymyr Zelenskyy, left, greets U.S. Ambassador to Ukraine Bridget Brink, right, prior to their meeting in Kyiv Tuesday, May 14, 2024. Blinken arrived in Kyiv on Tuesday in an unannounced diplomatic mission to reassure Ukraine that it has American support as it struggles to defend against increasingly intense Russian attacks. (Brendan Smialowski/Pool Photo via AP)

U.S. Secretary of State Antony Blinken, center, watches Ukraine's President Volodymyr Zelenskyy, left, greets U.S. Ambassador to Ukraine Bridget Brink, right, prior to their meeting in Kyiv Tuesday, May 14, 2024. Blinken arrived in Kyiv on Tuesday in an unannounced diplomatic mission to reassure Ukraine that it has American support as it struggles to defend against increasingly intense Russian attacks. (Brendan Smialowski/Pool Photo via AP)

Ukraine's President Volodymyr Zelenskyy, left, greets U.S. Secretary of State Antony Blinken, right, prior to their meeting in Kyiv, Ukraine, Tuesday, May 14, 2024. Blinken arrived in Kyiv on Tuesday in an unannounced diplomatic mission to reassure Ukraine that it has American support as it struggles to defend against increasingly intense Russian attacks. (Brendan Smialowski/Pool Photo via AP)

Ukraine's President Volodymyr Zelenskyy, left, greets U.S. Secretary of State Antony Blinken, right, prior to their meeting in Kyiv, Ukraine, Tuesday, May 14, 2024. Blinken arrived in Kyiv on Tuesday in an unannounced diplomatic mission to reassure Ukraine that it has American support as it struggles to defend against increasingly intense Russian attacks. (Brendan Smialowski/Pool Photo via AP)

U.S. Secretary of State Antony Blinken, right, arrives by train at Kyiv-Pasazhyrskyi station Tuesday, May 14, 2024, in Kyiv, Ukraine. (Brendan Smialowski/Pool Photo via AP)

U.S. Secretary of State Antony Blinken, right, arrives by train at Kyiv-Pasazhyrskyi station Tuesday, May 14, 2024, in Kyiv, Ukraine. (Brendan Smialowski/Pool Photo via AP)

U.S. Secretary of State Antony Blinken works while traveling on a Ukraine Railways train to Kiev, Monday, May 13, 2024, near Lviv, Ukraine. (Brendan Smialowski/Pool Photo via AP)

U.S. Secretary of State Antony Blinken works while traveling on a Ukraine Railways train to Kiev, Monday, May 13, 2024, near Lviv, Ukraine. (Brendan Smialowski/Pool Photo via AP)

U.S. Ambassador to Ukraine Bridget Brink, front, waits with Ukrainian Railways staff and others to greet U.S. Secretary of State Antony Blinken at Kyiv-Pasazhyrskyi station Tuesday, May 14, 2024, in Kyiv, Ukraine. (Photo by Brendan Smialowski/Pool Photo via AP)

U.S. Ambassador to Ukraine Bridget Brink, front, waits with Ukrainian Railways staff and others to greet U.S. Secretary of State Antony Blinken at Kyiv-Pasazhyrskyi station Tuesday, May 14, 2024, in Kyiv, Ukraine. (Photo by Brendan Smialowski/Pool Photo via AP)

U.S. Secretary of State Antony Blinken, right, arrives by train at Kyiv-Pasazhyrskyi station Tuesday, May 14, 2024, in Kyiv, Ukraine. (Brendan Smialowski/Pool Photo via AP)

U.S. Secretary of State Antony Blinken, right, arrives by train at Kyiv-Pasazhyrskyi station Tuesday, May 14, 2024, in Kyiv, Ukraine. (Brendan Smialowski/Pool Photo via AP)

U.S. Secretary of State Antony Blinken works while traveling on a Ukraine Railways train to Kiev, Monday, May 13, 2024, near Lviv, Ukraine. (Brendan Smialowski/Pool Photo via AP)

U.S. Secretary of State Antony Blinken works while traveling on a Ukraine Railways train to Kiev, Monday, May 13, 2024, near Lviv, Ukraine. (Brendan Smialowski/Pool Photo via AP)

U.S. Secretary of State Antony Blinken, center, walks to board a Ukrainian Railways train at Przemysl Glowny train station while traveling to Kyiv, Ukraine, Monday, May 13, 2024, from Przemysl, Poland. (Brendan Smialowski/Pool Photo via AP)

U.S. Secretary of State Antony Blinken, center, walks to board a Ukrainian Railways train at Przemysl Glowny train station while traveling to Kyiv, Ukraine, Monday, May 13, 2024, from Przemysl, Poland. (Brendan Smialowski/Pool Photo via AP)

U.S. Secretary of State Antony Blinken is greeted by U.S. Ambassador to Ukraine Bridget A. Brink after arriving by train at Kyiv-Pasazhyrskyi station May 14, 2024, in Kyiv, Ukraine. (Brendan Smialowski(Photographers name/Pool Photo via AP)

U.S. Secretary of State Antony Blinken is greeted by U.S. Ambassador to Ukraine Bridget A. Brink after arriving by train at Kyiv-Pasazhyrskyi station May 14, 2024, in Kyiv, Ukraine. (Brendan Smialowski(Photographers name/Pool Photo via AP)

Secretary of State Antony Blinken speaks at the RSA Conference in San Francisco, Monday, May 6, 2024. (AP Photo/Jeff Chiu)

Secretary of State Antony Blinken speaks at the RSA Conference in San Francisco, Monday, May 6, 2024. (AP Photo/Jeff Chiu)

U.S. Secretary of State Antony Blinken works while traveling on a Ukraine Railways train to Kiev, Monday, May 13, 2024, near Lviv, Ukraine. (Brendan Smialowski/Pool Photo via AP)

U.S. Secretary of State Antony Blinken works while traveling on a Ukraine Railways train to Kiev, Monday, May 13, 2024, near Lviv, Ukraine. (Brendan Smialowski/Pool Photo via AP)

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