WASHINGTON (AP) – President Joe Biden and House Speaker Kevin McCarthy are set to meet at the White House at a key moment as Washington works to compromise the budget and raise the nation’s borrowing limit in time to avoid a possible chaotic federal default..
Negotiators for the White House arrived Monday back at the Capitol for talks before the afternoon meeting between the Democratic president and the new Republican speaker. that will be critical as they race to contain the looming debt crisis next week.
After a weekend of start-stop talks, the two men appeared happy as they faced a deadline, when June 1when the government runs out of money to pay its bills.
On Monday morning, McCarthy took a sharper edge, blaming Biden for refusing to participate earlier in annual federal spending, a separate issue but linked to the national debt.
“What we need to do here is stop the spending spree,” McCarthy, R-Calif., told reporters as he arrived at the Capitol.
“The Democrats and the president refusing to even negotiate, no house is going to run this way,” he said. “So we go from crisis to crisis.”
McCarthy said as many times before: “We’re going to spend less than last year.”
The contours of an agreement appear to be achievable, and negotiations are narrowing on a 2024 budget year that will be key to resolving the standoff. Republicans insist that next year’s spending will not be more than current levels by 2023, but Democrats have refused to accept the steeper cuts initially proposed by McCarthy’s team.
A budget deal would open a separate vote to raise the debt ceiling, now $31 trillion, to allow more borrowing to pay the bills already incurred. Treasury Secretary Janet Yellen said Sunday that June 1 is a “hard deadline.”
A top Republican negotiator, Rep. North Carolina’s Patrick McHenry told reporters that a round of talks late Sunday went “reasonably well.”
“We know the deadline, we know the challenge,” said McHenry, who is also chairman of the House Financial Services Committee. “People work in good faith.”
But he said: “All these things are difficult.”
“We will continue to work,” said Steve Ricchetti, the president’s adviser, as the White House team exited the talks on Sunday.
Biden and McCarthy spoke by phone Sunday as the president flew home on Air Force One after the Group of Seven summit in Japan. “It’s going well, we’ll talk tomorrow,” Biden said in response to a shouted question upon his return on Sunday.
The call revived the talks, and negotiators met for 2 1/2 hours at the Capitol Sunday night, saying little as they left. Financial markets declined last week after the talks stopped.,
McCarthy, R-Calif., told reporters Sunday that the call with Biden was “productive,” and Biden told a press conference before leaving Japan: “I think we can make a deal .”
But McCarthy said, “I made it very clear to him from the beginning. We have to spend less money than we spent last year. “
Earlier, Biden used his closing news conference in Hiroshima, Japan, to say he had done his part by agreeing to spending cuts and warning, “It’s time for Republicans to accept that there is no agreement to be made only, only, on their own. partisan terms.”
“Now it’s time for the other side to move from their extreme position,” he said.
GOP lawmakers are holding fast to demands for sharper spending cuts with caps on future spending, rejecting alternatives proposed by the White House that call for reducing deficits in part of the budget. income from taxes.
McCarthy has personally insisted in his conversations with Biden that tax increases are off the table.
Republicans want to restore spending next year to 2022 levels, but the White House has proposed keeping 2024 the same as it is now, in the 2023 budget year. Republicans originally wanted to impose the spending caps for 10 years, though the latest proposal reduced that to about six. The White House wants a two-year budget deal.
A compromise on topline spending levels would enable McCarthy to deliver for conservatives, while not being so extreme that it would chase the Democratic votes needed in a divided Congress to pass any bill.
Republicans also want Medicaid work requirements health care program, although the Biden administration has countered that millions of people could lose coverage. The GOP further introduced new cuts to food assistance by restricting states’ ability to waive work requirements in areas with high unemployment. But Democrats say any changes to work requirements for government assistance recipients are non-starters.
GOP lawmakers are also demanding cuts to the IRS and, by sparing the Defense and Veterans accounts from cuts, would shift most of the spending cuts to other federal programs.
The White House is fighting back by continuing defense and nondefense spending next year, which would save $90 billion in the 2024 budget year and $1 trillion over 10 years.
All parties are looking at the potential for the package to include a framework that will facilitate energy project developments.
And despite Republicans pushing for the White House to also accept parts of their proposed immigration overhaul, McCarthy explained that the focus is on the previously approved debt and budget package in the House.
For months, Biden has refused to participate in discussions about the debt limit, arguing that Republicans in Congress are trying to use the vote on the borrowing limit as leverage to extract concessions from the administration on other issues. policy priority.
But as June approaches and Republicans put their own spending legislation on the table, the White House is launching talks on a budget deal that could include raising the debt limit.
McCarthy faces a hard-right wing that is likely to reject any deal, leading some Democrats to urge Biden to resist any compromise with Republicans and simply raise the ceiling on debt itself to avoid default.
The president, however, said he has ruled out the possibility, for now, of invoking the 14th Amendment as a solution, said it was an “unsettled” legal question that could be tied up in the courts.
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Miller reported and Associated Press writer Josh Boak contributed from Hiroshima, Japan. Associated Press writers Kevin Freking, Farnoush Amiri, Colleen Long and Will Weissert contributed to this report from Washington.