WASHINGTON (AP) — President Joe Biden announced Wednesday that he is confident the United States will avoid an unprecedented and catastrophic debt crisis, saying he will negotiate with congressional Republicans. have produced He left for the G-7 summit in Japan But he plans to return by the end of the week in hopes of ratifying a definitive agreement.
Biden’s upbeat comments came as a select group of negotiators gathered to hammer out the final contours of a budget spending deal. It should pave the way for raising the credit limit from June 1. That’s when the Treasury Department says the U.S. could default on its obligations and trigger a financial crisis.
“I am confident that we will get a deal on the budget and America will not default,” Biden said from the White House’s Roosevelt Room. Later Wednesday evening, negotiations resumed behind closed doors in the Capitol.
Democrat Biden and Republican Speaker Kevin McCarthy have blamed the debt ceiling impasse for weeks. But Biden said of a recent White House meeting with congressional leaders, “Everybody came to the meeting, I think, in good faith.”
McCarthy was also enthusiastic, though Biden was contested. The president said the budget talks were still separate from the debt ceiling issue, but said Speaker Biden had “finally backed down” on his refusal to negotiate.
“Keep working — we’ll work again tonight,” McCarthy told reporters afterward. “We’re going to work until we do it.”
Biden said that each leader — Vice President Kamala Harris, R-McCarthy, House Minority Leader Hakeem Jeffries, D-N.Y., Senate Majority Leader Chuck Schumer, R-Ky., and Senate Minority Leader Mitch McConnell, R-Ky., was present at Tuesday’s Oval Office meeting. . – Agreed that America should not fail in its obligations.
“If we don’t pay our bills it will be a disaster for the American economy and the American people,” Biden said. “I believe everyone in the room agreed … that we will come together because there is no alternative. We have to do what is right for the country. We have to move forward.
He said he would be “in touch” with White House officials while at the Hiroshima summit. He is canceling stops in Australia and Papua New Guinea to return to Washington on Sunday.
Biden and McCarthy assigned a handful of representatives to quickly try to hammer out a final deal. Among them are Steve Ricchetti, Counselor to the President; Legislative Affairs Director Louisa Terrell and Office of Management and Budget Director Shalanda Young, and McCarthy’s closest Republican ally, Rep. Garrett Graves, R-La.
McCarthy, who has said he will be personally involved, said he plans to stop talks after Wednesday. He said he was in Washington over the weekend while talks were underway.
Negotiators’ agreement would leave any deal requiring Senate and Republican approval.
Democrats are upset about new job requirements for some who receive government assistance. Republicans prefer more stringent budget controls than Democrats support.
Biden and McCarthy’s positive comments mean they hope they can win the support of lawmakers from their respective parties.
McCarthy was supported on the Capitol steps Wednesday by the most conservative Republicans from the House and Senate.
The national debt currently stands at $31.4 trillion. An increase in the debt limit does not authorize new federal spending; Congress would only allow borrowing that it had already authorized.
The contours of a deal are beginning to take shape, but the details of spending cuts and policy changes will determine whether a divided Congress can make or break a bipartisan deal with the White House.
In exchange for raising the debt ceiling to keep paying the bills, House Republicans in the new majority are trying to get a steep budget that will grow no more than 1% a year for the next decade.
Now that the government has lifted the pandemic emergency, negotiators are preparing to withdraw about $30 billion in unspent COVID-19 aid. They are working on a potential deal on permit changes that would speed development of energy projects that Republicans and Democrats want, though details remain sketchy.
But Democrats are unwilling to accept the 10-year limit that Republicans approved in their own House bill, instead pushing for a narrower window for budget cuts.
After opening the door to tougher job requirements, Biden is facing a fierce backlash from progressive Democrats. But he insisted Wednesday that any new work requirements are “of no consequence” and that he is not prepared to affect health plans, presumably referring to Medicaid.
Republicans — behind McCarthy — support more work requirements on Medicaid, food stamps and cash assistance programs.
Republicans jeered loudly as helicopters flew overhead with an apparently departing Biden.
McCarthy, who was counting on Donald Trump’s support to become the new speaker, still has work to do to maintain his narrow majority for any final deal, especially among hardline Independence Caucus conservatives who nearly blocked his election earlier this year. .
Former President Trump has encouraged Republicans to “default” if they don’t get everything they want from Biden.
“It takes bipartisanship,” Schumer said Wednesday. “It’s the only way to go.”
As backup on Wednesday, House Democratic Leader Hakeem Jeffries began a process to force a vote to raise the debt ceiling.
It’s a complicated legislative process, but Jeffries has urged House Democrats to sign the measure in hopes of gathering 218 majority co-sponsors, including Republicans.
“Emerging from the White House meeting, I believe there is a real path to finding an acceptable, bipartisan resolution that prevents default,” Jeffries said in a letter to colleagues.
“However, given the looming June 1 deadline and the urgency of the moment, it is important to pursue all legislative options in the event no agreement is reached.”