In the US debt dispute, President Biden will meet with Kevin McCarthy on Monday for crisis talks aimed at averting a default. He accuses Republicans of taking extreme positions.
In the US debt dispute, President Joe Biden and Republican House Speaker Kevin McCarthy will meet on Monday for crisis talks aimed at preventing the country from defaulting. Both sides announced this on Sunday in Washington. “My position has not changed,” McCarthy said on Twitter. The government cannot “continue to spend money we don’t have”.
President Joe Biden has previously accused Republicans of taking extreme positions. Some of the Republican negotiators’ proposals are simply “unacceptable,” Biden said Sunday at his final G-7 summit conference in Hiroshima, Japan. Republicans must understand that there can be no bipartisan agreement that “exclusively, exclusively” follows its terms.
Biden said he was ready to cut government spending, as Republicans demanded. But we also need to talk about government revenue, specifically about tax increases for the highest earners. Republicans are not prepared for this. Biden complained that there were “significant differences of opinion” on that point.
Biden’s trip to the G7 was on the brink due to a debt dispute
In early June, the US government is threatened with default if Biden’s team does not reach an agreement with Republicans in Congress to raise the debt ceiling by then. In the US, parliament sets this limit at irregular intervals and determines how much money the state can borrow. This time, the procedure degenerated into a bitter tug, which holds great dangers: a default by the world’s largest economy could trigger a global financial crisis and an economic slowdown.
The dispute followed Biden during his visit to Japan. The President was regularly briefed in Hiroshima on the progress of the negotiations. Because of the dispute, his participation in the G-7 summit was sometimes limited. Biden ended up canceling the second leg of his trip – a visit to Papua New Guinea and Australia – to return directly to Washington from Hiroshima on Sunday.
Yellen: Interruption likely before June 15th
Meanwhile, Treasury Secretary Janet Yellen said the US was unlikely to be able to pay its bills by mid-June, underscoring the urgency of a White House deal with Republicans to raise the debt limit. “Well, there’s always uncertainty about tax revenues and expenditures,” Yellen said on NBC’s Meet the Press on Sunday. “So it’s hard to be absolutely sure here, but my guess is that the chances of us getting to June 15th and still being able to pay all of our bills are pretty slim.”
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Yellen previously estimated that by June 1, the US might not be able to pay all of its bills, putting the country at risk of catastrophic default. Tax payments are due in mid-June, but bridging the gap by then is the problem, she said.