A meeting planned for Friday between President Biden and top congressional officials on the debt ceiling has been postponed until next week, leaders in Congress said.
Biden was expected to huddle with House Speaker Kevin McCarthy (R-Calif.), Senate Minority Leader Mitch McConnell (R-Ky.), Senate Majority Leader Charles E. Schumer, and House Minority Leader Hakeem Jeffries (D-N.Y.). The leaders also met Tuesday with only weeks left before what the Treasury Department has warned could be a June 1 deadline to raise the nation’s debt limit.
“The White House didn’t cancel the meeting — all the leaders decided it was probably in the best of our interest” if staff kept working before officials met again, McCarthy told reporters Thursday.
Accounts differed on the postponement’s significance. One GOP lawmaker, who spoke on the condition of anonymity to describe private talks, said the meeting had been postponed because discussions among staff members had been moving too slowly. Another person familiar with the matter disputed that, saying that the delay is a positive development that gives staff members more time to prepare options for the president and congressional leaders.
“We’re going to meet again when the productivity is — let the staff meet again tomorrow,” McCarthy told reporters. Asked if it reflected negotiations breaking down, McCarthy said “no, no, no — don’t take it from that perspective.”
Economists say failure to reach an agreement on the debt limit could spark a global financial crisis and send the U.S. economy into a recession, putting pressure on lawmakers to act. Congress may have only a few short weeks to raise the maximum amount the Treasury Department can borrow before the federal government runs out of funds. Officials said that could happen as soon as June 1, or sometime in early June.
Congressional staff and administration officials met for about two hours Thursday to discuss a potential agreement, as the parameters of a deal increasingly come into focus. Lawmakers have eyed a deal that would both raise the debt limit and enact new limits on federal spending, and could include measures such as permitting reform to spur energy production and rescinding unused covid aid money.
Still, critics on both the left and the right have already began pushing back on the potential compromise. For instance, Rep. Dusty Johnson (R-S.D.) said that most Republicans would oppose new caps on federal spending that only last two years. “That would be really difficult,” Johnson (S.D.), a leader of one of the moderate GOP factions, told reporters Thursday.
And Rep. Garret Graves (R-La.), the appointed leader of the GOP debt talks internally, said that raising the debt limit until 2025, as Democrats want, would also be tough thing for Republicans to accept and would require Biden to accept a large amount of cuts.
“You’re going to have to put more savings on the table,” Graves said.
But it may prove difficult for the White House to accept changes on the order of the magnitude the Republicans are demanding. Biden was adamant that he would not reward GOP demands over the debt limit with substantive concessions on policy, and liberals will likely be furious if he agrees to long-term budget cuts.
In a letter to Democratic colleagues Friday, Schumer highlighted a recent Washington Post-ABC poll that found that 58 percent of Americans say the debt limit and federal spending should be handled as separate issues. A much smaller 26 percent say Congress should only allow the government to pay its debts if Biden agrees to cut spending.
“I urge you to implore our Republicans colleagues: Take Default Off the Table,” Schumer wrote. “The clock is ticking.”
The House passed a bill last month that would raise the debt limit and cut federal spending back sharply, while also undoing some initiatives Biden has championed on climate policy and canceling student loans.
“The president should not give into hostage-taking, and instead follow the lead of the majority of Americans who vastly prefer bringing in revenue through tax increases on the rich rather than making harmful spending cuts,” said Lindsay Owens, executive director of the Groundwork Collaborative, a left-leaning think tank.
Liz Goodwin, Jeff Stein, Leigh Ann Caldwell and Mariana Alfaro contributed to this report.
What to know about the U.S. debt ceiling
The latest: Today, the House is expected to vote on a debt ceiling deal as lawmakers rush to avert a disastrous government default on June 5. If the debt ceiling isn’t raised by the deadline, here’s what a government default means and the payments at risk. Here are the negotiators who have been working toward a debt ceiling deal.
Understanding the debt ceiling fight: Biden and the House Republican leadership have been on a collision course over the national debt limit. In this comic, see how hitting the debt ceiling could unleash chaos. Here’s when the debt ceiling battle could end.
What is at stake? Invoking the 14th Amendment to dodge the debt limit is risky, White House officials say. If the debt limit is breached, Biden warned that it could send the U.S. economy into a free fall. The debt ceiling breach could wipe out 8 million jobs, a recent analysis found. Amid consumer anxiety over the uncertainty, financial experts warn against making fear-based decisions.