In the US there is still no agreement on the debt

McCarthy told reporters after more than an hour of talks with Biden that negotiators are going to “meet, work through the night” to try to find common ground.

“I think we’ve had a productive discussion. We don’t have an agreement yet,” McCarthy said. “I think we can still get to him.”

The Republican leader said he expected to speak to Biden every day but was unwilling to consider his plan to cut the deficit by raising taxes on the rich and closing tax loopholes in the oil and pharmaceutical industries. McCarthy focused on cutting spending in the 2024 federal budget.

Any agreement to raise the debt limit must be approved by both houses of Congress. The US Treasury has warned that it may be unable to pay all of its bills as of June 1.

If the debt ceiling is not raised, a default would ensue, rattling financial markets and driving up interest rates on everything from car loans to credit cards. Uncertainty is already weighing on investors and stocks.

McCarthy’s Republicans control the House with 222 congressmen to 213, while Biden’s Democrats hold a 51-49 majority in the Senate, making it difficult to reach a bipartisan deal that ensures enough votes to pass.

Republicans are pushing for deep spending cuts — except on defense, where they want increases — in exchange for backing a self-imposed increase in the government’s borrowing limit, which would cover the costs of already passed tax and spending cuts.

Democrats want to keep spending at this year’s levels, while Republicans want to return to 2022 levels. A plan passed by the House last month would cut a wide swath of public spending by 8% next year.

Biden had said before the meeting that he would consider spending cuts along with tax adjustments, but that the latest offer from the Republicans was “unacceptable.”