President Joe Biden declared on Saturday that ongoing negotiations with Congress to raise the US government’s debt limit were progressing, with further details anticipated in the next two days. Biden is expected to meet early next week with Republican House Speaker Kevin McCarthy and other congressional leaders to continue discussions following the cancellation of a planned meeting on Friday to allow staff members to carry on with their talks.
As conversations about raising the government’s $31.4 trillion debt ceiling progress, Biden’s aides and McCarthy have explored ways to curb federal spending to avoid a disastrous default. Also, the Treasury Department has warned that the US could run out of funds without an increase in the debt ceiling by June 1.
Bipartisan efforts to address looming default
Addressing reporters at Joint Base Andrews, Biden remained cautiously optimistic about the negotiations, stating, “I think they are moving along, hard to tell. We have not reached the crunch point yet.” He added that more information would be available in the next two days. Congressional staff and administration officials have been discussing a potential agreement to raise the debt limit and implement new restrictions on federal spending.
Spending cuts under consideration include permitting reform to boost energy production and revoking unused COVID-19 aid funds. However, some lawmakers have expressed opposition to the proposed compromise. McCarthy has insisted on attaching spending reductions to a debt ceiling increase. At the same time, Biden has maintained that he will not negotiate over the debt limit and has urged Congress to pass a clean increase before discussing a spending framework.
The ongoing stalemate has increased pressure on both sides to reach a consensus. Treasury Secretary Janet Yellen has cautioned that without an agreement, the US could face its first-ever default on its debt as early as June 1, a situation that would have devastating economic consequences and could plunge the global economy into a financial crisis.
When asked if a deal would be reached before June 1, Biden smiled, “Has to be.” The President’s determination underscores the situation’s urgency and the importance of bipartisan efforts to resolve the nation’s impending financial crisis.
In the coming week, President Biden is set to resume negotiations with Republican House Speaker Kevin McCarthy and other congressional leaders. Initially scheduled for Friday, the meeting was postponed enabling staff to continue their discussions. Biden’s aides and McCarthy have reportedly discussed limiting federal spending while raising the government’s $31.4 trillion debt ceiling. The Treasury Department has indicated that the nation could run out of funds without an increase in the debt ceiling by June 1, leading to a catastrophic default.
