Biden, McCarthy meet face-to-face on debt crisis worries

WASHINGTON– President Joe Biden and House Speaker Kevin McCarthy met face-to-face Wednesday for more than an hour of much-anticipated spending talks — “a good first meeting,” the new Republican leader said — but expectations for fast Progress as GOP lawmakers push has been slow for steep budget cuts in a deal to prevent a sovereign debt limit crisis.

The video in the media player is from an earlier report.

Biden has resisted direct spending negotiations related to vital measures to raise the country’s statutory debt ceiling and warned of the potential for chaos in the economy.

McCarthy had practically invited himself to the White House to start the conversation ahead of a summer debt deadline. And he came out and said the meeting went better than expected: The two agreed to meet again and the spokesman said he expected to hear from Biden soon.

“No agreement, no promises, except that we will continue this conversation,” McCarthy told reporters outside the White House.

He said he told the president he would not raise the debt ceiling without concessions from Democrats.

“I was very clear,” he said. “We’re not going to spend more next year than this year.”

And Biden’s answer? McCarthy said the president insisted on a vote on a “clean debt ceiling” without the budget cuts Republicans are asking for.

“We both have different views on this, but I thought it was a good meeting,” McCarthy said.

MORE: US hits debt ceiling; Ministry of Finance is now taking “extraordinary measures”

The Speaker of the House came to the afternoon session with no formal GOP budget proposal, but he is laden with the promises he made to far-right and other conservative Republican lawmakers during his difficult campaign to become Speaker of the House. He then vowed to work to bring federal spending back to 2022 levels — an 8% reduction. He also pledged to take steps to balance the budget within the decade – an ambitious if politically unattainable goal.

McCarthy said he told the president, “I’d like to see if we can come to an agreement well before the deadline.”

The political and economic stakes are high for both heads of state, who enjoy a cordial relationship, and for the nation as it works to avoid a debt default.

Treasury Secretary Janet Yellen told Congress last month that the government had reached the limit of its $31 trillion borrowing capacity, requiring Congressional approval to raise the ceiling to allow more debt to pay the nation’s already accumulated bills could. Although Yellen was able to take “extraordinary measures” to temporarily cover the bills, this funding is due to expire in June.

“Everyone asks Speaker McCarthy the same question: Show us your plan. Where’s your plan, Republicans?” Senate Majority Leader Chuck Schumer, DN.Y., said before the meeting.

“For days, Speaker McCarthy has been touting this meeting as some sort of major victory in his debt ceiling talks,” Schumer said. But he added: “Speaker McCarthy, showing up at the White House without a plan, is like sitting down at the table with no cards in hand.”

Raising the debt ceiling is a once-routine congressional vote that has taken on prominence over the past decade as the country’s debt burden mounts. The majority of newly elected Republicans in the House of Representatives want to force Biden and Senate Democrats to make budget cuts as part of an agreement to raise the limit.

Before the White House meeting, House Republicans met privately to discuss policy. And McCarthy met with Senate Republican leader Mitch McConnell in the Capitol on Tuesday.

McConnell has a history of doing business with Biden in the last debt ceiling showdown a decade ago. But the Senate GOP leader in the minority party says it’s up to McCarthy and the president to reach an agreement that would be acceptable to a majority in the new House of Representatives.

Nonetheless, McConnell is doing his part to influence the process from afar and is pushing Biden into negotiations.

“The President of the United States must not walk away from the table,” McConnell said in a Senate remark.

Cutting the federal budget is often easier said than done, as past budget deals have shown.

After a 2011 debt ceiling standoff during the Obama era, Republicans and Democrats agreed on general federal budget ceilings for domestic and defense spending for 10 years, but ultimately proved too prohibitive.

After initial cuts, both parties agreed to change budget caps in subsequent years to protect priority programs. The caps have recently expired anyway, and last year Congress approved a $1.7 trillion federal spending bill that sparked renewed outrage among fiscal hawks.

McCarthy reiterated that he would not propose cuts to Social Security and Medicare programs, which cater primarily to older Americans. But other Republicans want cuts as part of the overall belt tightening.

Such mainstay programs, along with the Medicaid health care system, account for the bulk of federal spending and are politically difficult to cut, especially with a growing population of needy in congressional districts across the country.

Agreeing on the size and scope of the GOP’s proposed cuts will be a major challenge for McCarthy as he struggles to build consensus within his slim Republican majority in the House of Representatives and to bridge the divide between his conservative and far-right wings of the party .

McCarthy told reporters he doesn’t count on Republican support alone and wants the help of Democrats to get a deal passed in Congress. But relying on a bipartisan approach could lead to a revolt from McCarthy’s far-right flank of lawmakers, who may threaten to oust him from his speakership.

After the GOP briefing behind closed doors Wednesday morning, several Republican lawmakers insisted they would not allow the negotiations to turn into a debt crisis.

“Obviously we don’t want to default on our debt. We won’t do that,” said Rep. Warren Davidson, R-Ohio. “But we need to have a discussion about the course we are on. Everyone knows it’s not sustainable.”

Oklahoma Rep. Kevin Hern, chair of the Republican Study Committee, held a separate briefing for his group, whose roughly 175 members make up most of the GOP majority in the House of Representatives.

Hern sent a letter to McCarthy outlining her policy on budget cuts ahead of the White House meeting.

The non-mandatory federal budget programs in the defense and budget areas have also proved difficult to cut.

Associated Press contributors Kevin Freking and Zeke Miller contributed to this report.

Copyright © 2023 by The Associated Press. All rights reserved. Biden, McCarthy meet face-to-face on debt crisis worries

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