No agreement on budget caps in sight ahead of Memorial Day recess

No agreement on budget caps in sight ahead of Memorial Day recess
© Greg Nash

The odds of congressional negotiators reaching a deal to lift budget caps and raise the debt ceiling ahead of their Memorial Day recess appear to be growing increasingly grim despite top lawmakers's earlier optimism. 

"The first meeting went pretty well the second meeting not as well,” House Minority Leader Kevin McCarthyKevin Owen McCarthyGOP rep: Trump needs to retaliate against Iran to deter other hostile nations Ocasio-Cortez: McCarthy should apologize to migrant children separated from their parents Lawmakers warn of 'grave situation' after drone shot down MORE (R-Calif.) said Wednesday. “I think it will take a little more time."

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Disagreements over nondefense discretionary spending remain a key sticking point between parties, with Republicans arguing Democrats are requesting “obscene” levels of spending. And while offers continue to be exchanged, no additional meetings between the “big four” — Speaker Nancy PelosiNancy PelosiThis week: Congress set for clash on Trump's border request Judd Gregg: An Irish friend and wisdom Juan Williams: Warren on the rise MORE (D-Calif.) House Minority Leader Kevin McCarthy (R-Calif.), Senate Majority Leader Mitch McConnellAddison (Mitch) Mitchell McConnellBiden, Eastland and rejecting the cult of civility California governor predicts 'xenophobic' GOP will likely be third party in 15 years This week: Congress set for clash on Trump's border request MORE (R-Ky.) and Senate Minority Leader Chuck SchumerCharles (Chuck) Ellis SchumerMcConnell-backed Super PAC says nominating Roy Moore would be 'gift wrapping' seat to Dems McConnell vows to 'vigorously' oppose Moore's Senate bid Pelosi: Trump delay on Harriet Tubman is 'an insult to the hopes of millions' MORE (D-N.Y.) — and administration officials have been scheduled, a source with knowledge of the discussions said.

The House is scheduled to fly out Thursday afternoon.

Negotiators seemed poised to strike a deal after a scheduled meeting ran long and resulted in a second meeting Tuesday. Senate Majority Leader Mitch McConnell (R-Ky.) said he expected an agreement by the end of the day.

Instead, the second meeting let out quickly with no deal.

"There are still some significant issues outstanding, particularly the domestic-side spending issues -- things like health care, infrastructure and things that average middle-class folks need,”  Sen. Minority Leader Charles SchumerCharles (Chuck) Ellis SchumerMcConnell-backed Super PAC says nominating Roy Moore would be 'gift wrapping' seat to Dems McConnell vows to 'vigorously' oppose Moore's Senate bid Pelosi: Trump delay on Harriet Tubman is 'an insult to the hopes of millions' MORE (D-N.Y.) said. 

Despite the impasse over nondefense spending, the group has been able to reach a general consensus around setting defense spending levels at $733 billion (including off-book spending) and a debt ceiling lift. 

Pressure for Congress to take action on raising the debt ceiling was amplified Wednesday after Treasury Secretary Steven MnuchinSteven Terner MnuchinThe Hill's Morning Report - Crunch time arrives for 2020 Dems with debates on deck Trump's tax returns — DOJ trying to put off the inevitable? GOP lawmakers want Mulvaney sidelined in budget talks MORE warned the U.S. government could face a default by late-summer, sooner than most analysts projected.

Democrats want spending for two programs – the 2020 census and the VA mission act – to be moved to off-budget accounts, leaving more room for other domestic priorities.

House Democrats on Wednesday approved a bill that included some $8.5 billion in spending for the 2020 census. The VA Mission Act, which had previously been funded through automatic mandatory spending, is due to move nearly $9 billion onto the discretionary side of the ledger this year.

A House aide said it was "more likely that we’ll discover the moon is made of green cheese” than strike a deal this week.