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Washington (AFP) – The US president, Joe Biden, once again declared himself optimistic about reaching an agreement with the Republican opposition to increase the country’s debt limit and avoid a default, despite tense negotiations to achieve it.
“I still think we can avoid a default and get something decent,” Biden told reporters during the G7 summit in Hiroshima, Japan.
With the Treasury Department warning that the US government could run out of money as of June 1 – causing massive economic upheaval at home and around the globe – the political battle in Washington has swung wildly. no clear sign of resolution.
Republicans continue to insist that Biden must cut public spending if he wants to win their support to raise the country’s debt ceiling, a ceiling whose increase or suspension is a spring for Congress.
The Democrats, meanwhile, maintain that the two things cannot be linked and want an increase in debt issuance capacity without conditions.
The leader of the Republicans in the United States House of Representatives, Kevin McCarthy, announced on Friday that the negotiations to avoid a default entered a “pause”, amid “real differences” according to the White House.
Then the talks resumed. Biden was informed of the situation on Saturday morning in Japan, and on Friday night in the United States, the White House reported.
Biden’s communications director, Ben LaBolt, said “Republicans are holding the economy hostage,” in a message that has been echoed by the White House. They are “pushing us to the edge of default, which could mean the loss of millions of jobs and send the country into a recession,” he said.
Although Biden will not accept “extreme” policies from the Republicans, “there is a way forward to reach a reasonable bipartisan agreement if the Republicans come back to the table to negotiate in good faith,” he added.
“Differences”
“The differences are big on many issues,” Rep. Patrick McHenry, one of the Republican negotiators, lamented on Friday, quoted by the NewsNation site.
Shortly before, the White House spoke of “real differences” with the opposition.
But the return to talks restored optimism to the government, White House spokeswoman Karine Jean-Pierre summed up on Saturday, after talks ended “just moments ago” in Washington.
The president, who is at the G7 summit in Japan, cut short his tour of Asia to return to Washington earlier to try to get a deal.
The pro-government camp presents the talks as an opportunity to discuss the budget, on which the Republicans are demanding cuts.
“We can’t spend more money next year,” Republican McCarthy said on Friday, in a wrestling match with the White House that has been going on for weeks, as June 1 approaches and the United States could enter an unprecedented moratorium.
Biden and McCarthy held two meetings in recent days as a deadline looms that the Treasury Department says could put the United States between a rock and a hard place.
The Republicans claim to lower public spending and the fiscal deficit, and they want to reduce the issuance of debt that usually makes it possible to cover that gap.
Democrats and Republicans do not agree on this increase in the debt issuance capacity of the United States, despite the fact that it is essential for the country to honor its payments to creditors, suppliers, pay salaries of public officials and pensions.
Raising the debt issuance limit is usually a routine procedure in the country, which has used this system dependent on Congress for decades. But this time, as has been the case with more frequency, the matter is the subject of a political struggle.
The United States exceeded the maximum limit for public debt issuance in January, which is 31.4 trillion dollars, and since then extraordinary measures have been applied that only allow it to meet obligations for a while.
