Joe Biden, Kevin McCarthy meet
White House negotiators and representatives of House Speaker Kevin McCarthy resumed debt ceiling talks Monday morning, as President Joe Biden prepared to meet with McCarthy face-to-face with only ten days to go until the U.S. risks default.
The talks came after negotiations broke down on Friday over an apparent impasse on government spending levels, but resumed several hours later. Biden and McCarthy spoke by phone Sunday evening, talks they described as “productive,” which could set the stage for anticipated progress towards a deal in the first part of this week. Biden and McCarthy are set to meet at 5:30 p.m. ET in the Oval Office on Monday.
Treasury Secretary Janet Yellen reaffirmed on Sunday that June 1 is the government’s “hard deadline” to raise the debt limit or face a likely first-ever national debt default. “We expect to be unable to pay all of our bills in early June, and possibly as soon as June 1,” Yellen told NBC’s Meet the Press.
Both Biden and McCarthy have acknowledged that one of the main sticking points in the talks remains the question of spending caps, a key GOP demand but a red line so far for the White House. Raising the debt limit would not authorize new spending, but Republicans have pushed to cut government outlays as part of a deal to hike the borrowing limit.
As Biden presses for a debt limit hike that would push the next deadline past the 2024 presidential election, Republicans are pushing to roll next year’s government spending back to its 2022 levels. “It is very frustrating if [Democrats] want to come into the room and think we’re going to spend more money next year than we did this year. That’s not right, and that’s not going to happen,” McCarthy said Friday evening.
Biden said he is willing to cut spending, but not while also preserving Republican tax cuts that largely benefit the wealthiest Americans. The president has also faulted Republicans for demanding that huge portions of federal spending be exempted from the proposed budget cuts, including defense spending and potentially veterans’ health benefits. Once these categories are exempted, cuts to other programs would need to be deeper to meet the baseline number.
“It’s time for Republicans to accept that there is no bipartisan deal to be made solely, solely, on their partisan terms,” Biden said at a press conference in Japan on Sunday.
FAQs:
What is the debt ceiling?
The debt ceiling, or the debt limit, is the total amount of money that the United States government can legally borrow. It is set by Congress and includes all public debt obligations. Congress must periodically raise the debt ceiling so the government can continue to borrow money to fund its operations.
Why is the debt ceiling important?
The debt ceiling is important because the government needs to borrow money to fund its operations and pay off its debts. Without an increase in the debt ceiling, the government risks defaulting on its debts, which could have catastrophic consequences for the U.S. economy and for global financial markets.
What happens if the U.S. reaches the debt ceiling?
If the U.S. reaches the debt ceiling, the government will not be able to borrow any more money, which means it will not be able to pay its bills. This could lead to a government shutdown, furloughs of federal employees, delays in Social Security and Medicare payments, and other serious consequences.
What happens if the U.S. defaults on its debt?
If the U.S. defaults on its debt, it would have serious consequences for the global economy and financial markets. It could lead to higher interest rates, a sharp drop in the value of the U.S. dollar, and a global economic recession. It could also cause a loss of confidence in the U.S. government and its ability to manage its finances.
Meeting between Joe Biden and Kevin McCarthy
White House negotiators and representatives of House Speaker Kevin McCarthy resumed debt ceiling talks on Monday, as President Joe Biden prepares to meet with McCarthy face-to-face. With only 10 days remaining until the US risks default, the talks resumed after negotiations broke down on Friday over an impasse on government spending levels. Biden and McCarthy spoke over the phone on Sunday evening, describing their talks as “productive,” and setting the stage for anticipated progress towards a deal this week. The White House team, composed of presidential counselor Steve Ricchetti, Office of Management and Budget Director Shalanda Young, and legislative affairs director Louisa Terrell, declined to speak with reporters when they walked into the Capitol for talks with McCarthy’s side on Monday.
This comes in the wake of Treasury Secretary Janet Yellen’s reaffirmation on Sunday that June 1 is the government’s “hard deadline” to raise the debt limit, or face a likely first-ever national debt default. “We expect to be unable to pay all of our bills in early June, and possibly as soon as June 1,” Yellen said. Republicans have pushed to cut government outlays as part of a deal to hike the borrowing limit, but Democrats have resisted this, with Biden blaming Republicans for demanding that huge portions of federal spending be exempt from budget cuts, including defense spending and potentially veteran’s health benefits. “It’s time for Republicans to accept that there is no bipartisan deal to be made solely on their partisan terms,” Biden said.