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Trump budget director backs off demand to tie debt ceiling increase to spending cuts

  • The Trump administration wants Congress to enact a "clean" increase in the debt ceiling, Mulvaney said.
  • The tax overhaul plan being crafted will not increase any current rates, including tax rates for the highest earners, he said.
  • Mulvaney also praised new Chief of Staff John Kelly's leadership.

Two significant Trump administration economic policy debates — one on the federal debt ceiling, the other on plans for tax reform — have been settled.

On the debt limit, White House budget director Mick Mulvaney says the entire administration now wants Congress to enact a "clean" increase in the debt ceiling.

Mulvaney has previously called for tying negotiated spending cuts to an increase, but he told a small group of journalists Thursday that Treasury Secretary Steven Mnuchin's call for an unencumbered increase has triumphed in internal deliberations.

Congress must raise the debt ceiling soon in order to protect U.S. creditworthiness.

On taxes, Mulvaney said the forthcoming overhaul plan being crafted with House and Senate leaders will not increase any current tax rates — including the 39.6 percent top rate for the highest earners.

White House strategist Stephen Bannon has floated the idea of an increase in the top rate to blunt Democratic attacks about giveaways to the rich. But the White House economic team has discarded that possibility, Mulvaney said.

The budget chief also praised the early turn toward greater White House discipline under new Chief of Staff John Kelly. Among other effects, Mulvaney said, the retired Marine General has tightened up monitoring of meetings and conversations with the president.

When he talks to Trump on the phone now, Mulvaney said, Kelly is on the line. When he walks into the Oval Office, Kelly is there keeping track of who goes in and out, he said.