Debt talks are set to resume as President Joe Biden and House Speaker Kevin McCarthy prepare to meet in person Monday about averting an economy-wrecking federal default
Debt ceiling talks were set to resume Sunday evening as Washington races to strike a budget compromise along with a deal to raise the nation’s borrowing limit and avert an economy-wrecking federal default.
President Joe Biden and House Speaker Kevin McCarthy spoke by phone Sunday while the president was returning home on Air Force One after the Group of Seven summit in Japan. Upbeat, McCarthy, R-Calif., told reporters at the Capitol that the call was “productive” and that the on-again, off-again negotiations between his staff and White House representatives are focused on spending cuts.
He’s to meet Biden on Monday at the White House.
Negotiators for the Democratic president and Republican speaker appear to be narrowing on a budget cap for the 2024 budget year that would be key to resolving the standoff. They face a deadline, as soon as June 1, when the government could run out of cash to pay its bills. Treasury Secretary Janet Yellen said Sunday that June 1 is a “hard deadline.”
McCarthy said after his call with Biden that “I think we can solve some of these problems if he understands what we’re looking at.” The speaker added, “But I’ve been very clear to him from the very beginning. We have to spend less money than we spent last year.”
McCarthy emerged from that conversation sounding optimistic and was careful not to criticize Biden’s trip, as he had before. He did caution, “There’s no agreement on anything.”
“We’re looking at, how do we have a victory for this country?” McCarthy said. “How do we solve problems? He said he did not think the final legislation would remake the federal budget and the country’s debt, but at least “put us on a path to change the behavior of this runaway spending.”
The White House confirmed the Monday meeting and late Sunday talks but did not elaborate on the leaders’ call.
Earlier, Biden used his concluding news conference in Hiroshima, Japan, to warn House Republicans that they must move off their “extreme positions” over raising the debt limit and that there would be no agreement to avoid a catastrophic default only on their terms.
