On Tuesday, leading congressional Republicans Kevin McCarthy and Democratic President Joe Biden will meet to attempt and advance an agreement to extend the U.S. government’s $31.4 trillion debt ceiling and avoid an unthinkable economic default.
They don’t have much time to come to an agreement. The U.S. Treasury Department warned once again on Monday that it would not have enough money to pay all of its obligations as early as June 1. This would result in a default, which analysts say is likely to cause a severe economic collapse.
Speaker of the House of Representatives Kevin McCarthy stated to reporters on Tuesday that his party would only accept a deal that reduced spending. His party now holds a 222-213 majority in the chamber.
If we cut back on future spending, we can raise the debt ceiling, McCarthy told reporters.
Happening today: McCarthy and Biden will meet today to discuss the debt ceiling. Also in attendance will be Hakeem Jeffries, McConnel, and Chuck Schumer. If a deal isn’t agreed upon by June 1st, it could cause a default and the US economy will take a very sharp downturn. This… pic.twitter.com/5yiF7Pqb8W
— 🇺🇸Travis🇺🇸 (@Travis_in_Flint) May 16, 2023
Both parties concur that immediate action is required. The White House meeting on Tuesday is scheduled to start at 3 p.m. EDT (1900 GMT), and participants will include Biden, McCarthy, Democratic Senate Majority Leader Chuck Schumer, top Senate Republican Mitch McConnell, and top House Democrat Hakeem Jeffries.
According to individuals informed on the discussions, staff for both parties has recently discussed a variety of ideas, including spending limitations, new work requirements for some benefit programs for low-income Americans, and adjustments to energy permits in exchange for votes to lift the ceiling.
“The clock is ticking. Treasury Secretary Janet Yellen told a group of bankers, “We are incurring greater economic consequences every single day that Congress does not act, which might slow the U.S. economy. “Time is of the essence.”
A comparable impasse in 2011 resulted in a record reduction of the United States’ credit rating, which prompted a stock market sell-off and increased borrowing costs for the government.
Keep Up with Current Events: Follow These Links for More News:
- In Fatal Walgreens Shoplifter Shooting, San Francisco Security Guard Will Not Be Charged
- Deadly Gunman Targets Random Victims in Farmington, New Mexico: 3 Killed, 6 Injured
On Monday revealed that three-quarters of Americans worry that a default would have a significant negative impact on families just like their own. The present deadlock has alarmed investors and caused the cost of insurance exposure to U.S. government debt to reach record highs.
In a speech to the Senate on Tuesday, Schumer said that “nobody should use default as a hostage.” “America would suffer devastating effects,”
Some observers worry that the five-party negotiations are too complicated to move forward.
John Thune, the No. 2 Senate Republican, told reporters that there are “too many cooks” in the negotiations.
It’s Biden and McCarthy, as we’ve been saying all along, Thune remarked. Therefore, whoever can truly speak for the president ought to enter the meeting, invite McCarthy’s top officials inside, and get things done.
President Biden wants you to think the sky will fall due to spending limits passed by House Republicans.
The truth is we've proposed limiting spending to what it was just 5 months ago. It's reasonable, responsible, and actually higher than the last Obama/Biden budget proposal. pic.twitter.com/5BmFaSDtJK
— Kevin McCarthy (@SpeakerMcCarthy) May 15, 2023
McCarthy said that he would prefer to speak with Biden privately.
“The Democrats in the Senate will support any agreement that the president reaches. If we can all agree, the House will approve it, McCarthy said. Why do we continue to waste time running in circles while failing to address any of the fundamental issues? I believe that by doing that, you endanger the nation.
In order to increase the power of hardliners, such as the roughly thirty-two members of the House Freedom Caucus, McCarthy agreed to a change in House rules when he took office as speaker early this year. This change gives hardliners more power and makes it more difficult to reach an agreement.