WASHINGTON (AP) -- An "agreement in principle" between President Joe Biden and House Speaker Kevin McCarthy would raise the nation's legal debt ceiling, but now Congress has only days to approve a package that includes spending cuts and would avert a potentially disastrous U.S. default.
The compromise announced late Saturday risks angering both Democratic and Republican lawmakers as they begin to unpack the concessions. Negotiators agreed to some Republican demands for increased work requirements for recipients of food stamps that House Democrats had called a nonstarter. But bargainers stopped short of greater spending cuts overall that Republicans wanted.
Support from both parties will be needed to win congressional approval before a projected June 5 government default on U.S. debts. Lawmakers are not expected to return to work from the Memorial Day weekend before Tuesday, at the earliest, and McCarthy has promised lawmakers he will abide by the rule to post any bill for 72 hours before voting.
White House officials planned to brief House Democrats on a video call Sunday.
The Democratic president and Republican speaker reached the agreement after the two spoke Saturday evening by phone. The country and the world have been watching and waiting for a resolution to a political standoff that threatened the U.S. and global economies.
"The agreement represents a compromise, which means not everyone gets what they want," Biden said in a statement. "That's the responsibility of governing."
Biden said the deal was "good news for the American people because it prevents what could have been a catastrophic default and would have led to an economic recession, retirement accounts devastated, and millions of jobs lost."
McCarthy told reporters at the Capitol on Sunday that the agreement "doesn't get everything everybody wanted," but that is to be expected in a divided government. "At the end of the day, people can look together to be able to pass this."
With the outlines of an agreement in place, the legislative package could be drafted and shared with lawmakers in time for House votes as soon as Wednesday, and later in the coming week in the Senate.
Central to the compromise is a two-year budget deal that would hold spending flat for 2024 and increase it by 1% for 2025 in exchange for raising the debt limit for two years, which would push the volatile political issue past the next presidential election.
Driving hard for a deal to impose tougher work requirements on government aid recipients, Republicans achieved some but not all of what they wanted. The agreement would raise the age for existing work requirements on able-bodied adults, from 49 to 54, without children. Biden was able to secure waivers for veterans and the homeless.
The two sides had also reached for an ambitious overhaul of federal permitting to ease development of energy projects. Instead, the agreement would put in place changes in the landmark National Environmental Policy Act that will designate "a single lead agency" to develop environmental reviews, in hopes of streamlining the process.
The deal came together after Treasury Secretary Janet Yellen told Congress that the United States could default on its debt obligations by June 5 -- four days later than previously estimated -- if lawmakers did not act in time. Lifting he nation's debt limit, now at $31 trillion, allows more borrowing to pay the nation's already incurred bills.
McCarthy commands only a slim Republican majority in the House, where hard-right conservatives may resist any deal as insufficient as they try to slash spending. By compromising with Democrats for votes, he risks losing support from his own rank and file, setting up a career-challenging moment for the new speaker.
"I think you're going to get a majority of Republicans voting for this bill," McCarthy said on "Fox News Sunday." "This is a good bill for the American public. The president agreed with this bill. So I think there's going to be a lot of Democrats that will vote for it too."
But McCarthy also said that "right now, Democrats are very upset," and House Minority Leader Hakeem Jeffries of New York told him, "There's nothing in the bill for them. There's not one thing in the bill for Democrats."
In a tweet Sunday, Jeffries said he was "thankful" Biden had reached an agreement in principle and looked forward to reviewing the bill when it was released.
Both sides have suggested one of the main holdups was a GOP effort to expand work requirements for recipients of food stamps and other federal aid programs, a longtime Republican goal that Democrats have strenuously opposed. The White House said the Republican proposals were "cruel and senseless."
Biden has said the work requirements for Medicaid would be a nonstarter. He had seemed potentially open to negotiating changes on food stamps, now known as the Supplemental Nutrition Assistance Program, or SNAP, despite objections from rank-and-file Democrats.
Americans and the world were uneasily watching the negotiating brinkmanship that threatened to throw the U.S. and global economy into chaos and sap world confidence in the nation's leadership.
Anxious retirees and others were already making contingency plans for missed checks, with the next Social Security payments due next week.
Yellen said failure to act by the new date would "cause severe hardship to American families, harm our global leadership position and raise questions about our ability to defend our national security interests."