Congressional leaders reach a debt deal to avoid painful sequestration cuts

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Congressional leaders reach a debt deal to avoid painful sequestration cuts. According to Time, the agreement sets spending levels for two years and removes scheduled automatic cuts in an attempt to avert another government shutdown.

Tweet this chart. 3. The Budget Deal Would Cost Nearly Twice as Much as Sequester Repeal. Much of the rationale for past budget deals has been to avoid sequestration, which was a consequence of the 2012 Joint Select Committee on Deficit Reduction’s ("Super Committee") failure to come to agreement on a debt reduction deal.

WASHINGTON (AP) – Top leaders of both parties in Congress made better-than-expected progress Tuesday on two must-do items on the legislative agenda: averting automatic budget cuts and meeting a.

The likelihood that both sides will be able to reach a deal to end the shutdown is being further complicated by a looming deadline to raise the nation’s debt limit. The U.S. Treasury Department announced that Congress will need to approve an increase in the federal debt ceiling before October 17 in order to avoid a default.

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The four congressional leaders and Mnuchin then had a 5 p.m. conference call to resolve outstanding issues, the aide said. The two-year agreement would suspend the debt limit until July 31, 2021, and put an end to automatic spending cuts that would have kicked in without a deal.

After Congress passed the deal. avoid these kinds of controversies, leaders in Congress have chosen to set aside the norms of the formal process and postpone all serious decisions on budget matters.

These cuts began on March 1, 2013. Sequestration was originally supposed to occur January 1, but Congress moved the date to March as part of its deal to avoid the fiscal cliff. This series of tax increases would have subtracted $607 billion gross domestic product.

The current sequestration is the result of a series of annual battles over the debt ceiling, a solution thought to be so penal that both parties would be forced to negotiate an acceptable compromise between spending cuts and increased taxes to avoid its implementation.

It’s Washington’s latest case of economic hostage-taking: If Congress and President Barack Obama don’t reach a deal by March 1, the federal budget gets whacked! Voters have heard these.

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