President Biden and spokesman Kevin McCarthy expressed optimism on Monday that they could break the partisan deadlock that has stifled action to avoid a country’s debt default, but they remained distant on a deal to raise the debt limit while Democrats resisted Republican demands for spending. cuts in return.
The two met face-to-face at the White House for the second time in as many weeks in a show of goodwill after a weekend of backroom clashes between negotiators, punctuated by a move by Republicans on Friday to halt talks and accusations. by both sides that the other was being unreasonable.
With Mr. Biden back from a summit in Japan, the tenor seemed to have changed considerably.
“We still don’t have a deal,” McCarthy told reporters at the White House after the meeting. “But I felt the discussion was productive,” he said, later adding that he believed the tone of the conversations was “better than any other time we’ve had discussions.”
“I believe we can still get there,” McCarthy said. “I believe we can do this.”
He said he looked forward to speaking with Biden daily until a deal could be reached.
With default looming on June 1, Biden and McCarthy began their latest meeting sounding optimistic about finding common ground in an effort to avert an economic catastrophe, and set out dispatching their top advisers to reach a deal in the coming days. .
“We still have some disagreements, but I think we can get where we need to go,” Biden said as the two took their seats in the Oval Office. “We both know we have a significant responsibility.”
Biden said in a brief statement after the meeting that the talks were “productive”.
“We reiterate once again that default is out of the question and the only way forward is in good faith towards a bipartisan agreement,” he added, saying that he and his negotiating team will continue talks with McCarthy and his team.
Still, the two sides remained at odds. The White House called Republicans’ demands for spending cuts extreme, while McCarthy and his aides accused White House officials of being unreasonable.
The number of legislative days for Congress to vote to raise the debt ceiling ahead of schedule is rapidly decreasing. Treasury Secretary Janet L. Yellen on Monday reiterated her warning to Congress that the United States could exceed its authority to borrow to pay its bills as early as June 1. the chances of the government being able to hold out until mid-June – when a substantial amount of quarterly tax revenue is expected to come in, giving the Treasury more breathing room to cover its obligations – were “quite low”.
And Republicans hinted that no deal was likely to come to fruition until a default was indeed imminent. When asked on Monday night what it would take to break the deadlock, McCarthy replied simply: “June 1st.”
Chief among the outstanding issues is how much to spend in the next fiscal year on discretionary programs and how long spending limits should be in effect. Republicans want to allow military spending to increase while cutting other programs. But they showed some flexibility in how long they would look to cap spending overall, cutting back from their initial demand of a decade to six years.
This is more than Mr. Biden wants. White House officials have proposed keeping military and other spending — which includes education, scientific research and environmental protection — constant over the next two years.
“These are tough questions,” said Representative Patrick T. McHenry, a North Carolina Republican and a key McCarthy ally, who was involved in the talks and attended the White House meeting. “A directive to cut spending year after year is the hardest thing to do in Washington, DC But that’s the speaker’s directive to his negotiating team. It is our expectation to achieve this.”
Far-right members of McCarthy’s conference continued to press the president to accept nothing less than the spending cuts that House Republicans passed in their debt limit bill last month, which would represent a mid-range reduction. 18 percent a decade.
“Republicans must #HoldTheLine on the debt ceiling to bring spending back down to earth and restore fiscal sanity in DC,” the House Freedom Caucus wrote on Twitter. “We spend more than $100 billion more than federal tax revenue EVERY MONTH. Washington has a spending problem, not a revenue problem.”
McCarthy expressed confidence that he could keep his conference largely united around whatever deal he struck with Biden, telling reporters on Capitol Hill ahead of the meeting that he believed it would draw support from Democrats and Republicans alike.
“I firmly believe that we are negotiating now, the majority of Republicans will see that this is the right place to put us on the right track,” he said.
But he also hinted that his conference members should be prepared to accept a final product that falls short of what some lawmakers have demanded.
“I don’t want you to think that, in the end, the bill that we’ve introduced is going to solve this whole problem,” he said. “But it will be a step towards finally acknowledging our problem and taking a step in the right direction. And we’ll come back the next day and take the next step.”
Once negotiators agree on an agreement, it will take time to translate it into legislative text. McCarthy pledged he would give lawmakers 72 hours to review the bill and said on Monday he believes negotiators will need to agree a deal this week to pass legislation raising the debt ceiling before the scheduled June 1 deadline. .
House lawmakers were still unsure about when they would need to be in attendance to vote to avoid a default. The House on Monday night was scheduled to depart Washington beginning Thursday afternoon before Memorial Day weekend.
The two sides reached some agreement in talks last week, including the recovery of some unspent funds from previously passed Covid-19 relief legislation.
Senior administration officials have said that Project NextGen, the Biden administration’s $5 billion Covid vaccine development program, could be among the victims of these cuts. The program, modeled in part on the Trump administration’s Operation Warp Speed, is an effort to find different forms of vaccines that scientists believe will offer more durable protection against the coronavirus.
But many other issues still need to be resolved, including stricter work requirements for healthy adults without dependents for certain social safety net programs. The bill passed by House Republicans contained stricter requirements for recipients of Temporary Assistance for Needy Families and food stamps, and is a key demand from conservatives in the House.
McCarthy said on Monday he would continue to push for their inclusion in any deal he strikes with Biden, and White House negotiators have shown openness to finding some compromise on the issue.
Carl Hulse contributed reports.
