Senate leaders announce debt-ceiling deal, but Republicans could drag out process.

Majority Leader Chuck Schumer, D-N.Y., announced the truce during a brief statement on the Senate floor, noting the agreement would permit the country to continue borrowing unimpeded into early December. Schumer said that chamber leaders now "hope we can get this done as soon as today," though a vote could slip until potentially this weekend.

The potential resolution came after a tense few weeks of fighting, which saw Democrats try repeatedly to suspend the country's debt ceiling - only to falter at the hands of GOP lawmakers. Senate Minority Leader Mitch McConnell, R-Ky., led the blockade as part of the party's broader opposition toward President Joe Biden's spending agenda, including a still-forming, up-to $3.5 trillion package that GOP lawmakers vehemently oppose.

But McConnell backed down somewhat late Wednesday, offering Democrats a temporary break. Hammered out overnight, the plan would raise the debt ceiling by $480 billion, which is expected to fund federal borrowing until December 3, according to a Senate aide familiar with the agreement who requested anonymity to describe it.

Schumer and McConnell still must shepherd their deal through the chamber, a process that exposed potential cracks in their strategy by midday Thursday. A number of GOP lawmakers appeared reticent to supply the support needed to proceed to a final vote, prompting Sen. John Thune, R-S.D., the party's leading vote counter, to acknowledge to reporters that the vote is "not an easy one to whip."

"In the end, we'll be there," Thune said. "But it'll be a painful birthing process."

A successful vote in the Senate, followed soon by the House, would avert a financial crisis with only days to spare ahead of the original October 18 deadline. Absent action by that date, the U.S. government would have faced an unprecedented struggle to fulfill its own financial obligations - including paying Social Security to seniors, providing tax benefits to families with children, or offering benefits to troops and veterans.

But the short-term deal also threatens to defer a bigger, more vicious battle between Democrats and Republicans until the waning hours of the year. The new, expected debt ceiling deadline comes on the same day that funding for the federal government is set to expire. That means Congress must act by December 3 to stave off default and prevent a federal shutdown, two urgent tasks that carry significant political and economic consequences in the case of failure.

For now, at least, the agreement over the debt ceiling spares Washington from what experts broadly saw as a financial doomsday that could have rattled markets globally and plunged the United States into a new recession. Biden in recent days had pressured Congress to act, blasting Republicans from obstructing a long-term increase to the borrowing cap while huddling with the nation's business leaders to further make the case for swift action.

To that end, markets appeared to reward news of the Senate deal, with the Dow Jones industrial average surging more than 500 points by midday. The uptick only served to confirm the stakes in Washington's latest fiscal stalemate, which earlier in the week raised the prospect that the U.S. could suffer a credit downgrade.

The debt ceiling allows the government to borrow money to pay its bills, since the country spends more than it collects through tax revenue. Raising the cap is a necessity that in the past had been a bipartisan affair: Democrats even joined with Republicans to address the issue repeatedly under former president Donald Trump, who added $8 trillion to the debt during his time in office.

But Republicans over the past nine months have turned it into a political cudgel as they labor to fight back against Biden's economic initiatives. The crux of the GOP opposition is a still-forming proposal to overhaul federal education, health care, immigration and climate laws, while raising taxes on wealthy Americans and corporations. Even though Democrats say the package is financed in full, Republicans argue it would add to the deficit even beyond the 10-year scope of the plan - prompting them to withhold their support for an increase to the debt ceiling.

"I do not support the Democrats' [spending] package and I do not support raising the debt limit to make that level of spending possible," said Sen. Lindsey Graham, R-S.C., the top Republican on the chamber's budget committee, in a statement late Wednesday.

The Republicans' opposition has frustrated Schumer and his fellow Democrats for weeks, who repeatedly pointed out that the debt ceiling covered past spending, including bipartisan initiatives to respond to the coronavirus pandemic last year. But their entreaties failed to loosen the GOP blockade until McConnell offered a roughly two-month extension after meeting with his conference Wednesday.

The deal they championed a day later could carry federal borrowing until December 3, but the deadline is only a rough estimate, according to Shai Akabas, the director of economic policy at the Bipartisan Policy Center. He said it ultimately is going to vary depending on how much the country spends and brings in through tax collection, which has been difficult to predict in recent months given the coronavirus pandemic.

"Nobody can know exactly how long that is going to last," Akabas said, though he expressed a measure of confidence it could at least carry the country until early in December.

Eventually, though, the country is going to reach its borrowing cap and approach the precipice of a default - warranting another intervention on Capitol Hill. That risks reigniting the same battle that had pushed the Senate only 11 days away from what Biden has described as a "meteor" crashing into the U.S. economy.

Entering the fight, McConnell has maintained an insistence that Republicans are not going to provide the 10 votes Democrats need to advance a longer-term measure to address the debt ceiling in the narrowly divided chamber, where most legislation requires 60 votes to advance. Instead, he has said Democrats must use reconciliation, a budgetary process that will allow them to move a proposal raising the borrowing cap on their own - a move that the party has rejected.

Schumer has refused to take that route, which he has described as "risky" because it could take too long to complete, putting the country at greater risk for default. Privately, Democrats also acknowledge that reconciliation could open them up to uncomfortable political votes and attacks, especially because it requires them to raise the debt ceiling by a specific amount rather than suspending it outright.

In a sign of the fight to come, McConnell took to the floor Thursday to herald their deal as a way to "spare the American people any near-term crisis." But he also repeated they must use reconciliation, unleashing renewed attacks on Democrats for their "reckless taxing and spending spree" in the process.