House Speaker Kevin McCarthy said he will meet with Joe Biden on Wednesday to discuss preventing a US debt default, but cautioned the president that his refusal to contemplate spending cutbacks in return for lifting the borrowing limit must be reconsidered.
“I want to find a sensible and responsible method to raise the debt ceiling,” the Republican leader said on CBS Sunday’s “Face the Nation.
McCarthy’s meeting with the president will be his first since becoming Speaker of the House of Representatives earlier this month after Republicans took control of the chamber.
Raising the national debt ceiling, which permits the government to pay for previously incurred expenses, is a common occurrence.
Members of the new Republican House majority, however, have threatened to obstruct the normal rubber-stamping of any increase over the current $31.4 trillion.
Biden argues the issue is unresolvable, accusing Republicans of holding “the economy hostage” in order to force a purely political debate on federal spending.
Biden’s official agenda stated only that he would address “a range of problems” with the Republican speaker, underscoring the White House’s inability to even characterize the meeting as a negotiation.
Raising the debt ceiling is “a duty of this country and its leaders to avert economic calamity,” according to White House spokesperson Karine Jean-Pierre. “Congress has always done it, and President Biden wants them to do it again.”
“That is not a debatable point.”
This sets the scenario for a high-stakes fight in the coming weeks or months.
Treasury Secretary Janet Yellen has warned that a US debt default could spark a worldwide financial disaster, raising borrowing costs and eroding the dollar’s status as an international reserve currency.
To give the two sides more time to work out a solution and prevent a default, the Treasury Department began using “extraordinary measures” on January 19 to temporarily decrease the amount of outstanding debt subject to the limit.
Yellen stated that if no deal is reached, a default may happen as early as June.
While McCarthy expressed confidence that “there won’t be a default,” he emphasized that Democrats were responsible for historically high spending levels within the first two years of Biden’s presidency.
“We can’t keep going down this road,” he stated on CBS.
‘Give us a choice.’
A Democratic congressman from Washington state, Adam Smith, pushed back, claiming Republicans had failed to specify where they would make cuts.
“Right now, Republicans lack a strategy,” he stated on “Fox News Sunday.”
“Their goal, as driven by their party’s radicals, is to scream about spending while failing to increase the debt ceiling and failing to present a plan that says, ‘This is where we’re going to cut.'”
“Give us an alternative, and then we can fight about it,” he continued.
McCarthy, on the other hand, expressed hope that a compromise could be made to avoid default.
“I would like to sit down with the President and hammer out an arrangement so that we can go forward and get back on track,” the speaker added.
“I believe the president will be willing to reach an arrangement with us,” he continued.
According to Jean-Pierre, the meeting on Wednesday will also examine the president’s plan to reduce the US budget deficit “by having the affluent and major businesses pay their fair share,” rather than slashing politically sensitive social spending, as some Republicans propose.
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