The Biden-McCarlo Meeting: Spending and the Debt: Taking the Lead on the Deal with the Boundary Problem
It will be the first time Biden and McCarthy meet on this issue since they met in February. They will be joined by House Minority Leader Hakeem Jeffries, D-N.Y., along with Senate Majority Leader Chuck Schumer, D-N.Y., and Senate Minority Leader Mitch McConnell, R-Ky.
Last week the Treasury Secretary warned lawmakers that the government could run out of money as early as June 1 if the debt ceiling is not raised.
The government is at risk of not being able to pay its debt for the first time, and Republicans in the House are again demanding spending cuts in exchange for raising the debt limit. Faced with the highest-stakes economic obstacle of his presidency and left with the searing memory of Obama-era fights, Mr. Biden has held firm that the discussion over raising the $31.4 trillion debt limit must take place separately from spending negotiations, advisers say.
But Democrats and the White House continue to insist that the bill is a nonstarter. Jeffries called the measure a “ransom note,” and the bill is dead on arrival in the Democratic-controlled Senate.
Congressional Democrats and Biden say that the debt ceiling should be addressed with spending cuts, rather than holding the economy hostage. If there is a debt default, the clean bill would prevent that from happening and separate negotiations on spending cuts.
“We’re not a deadbeat nation. Biden said they pay their bills. All along I have said we can debate where we should cut, how much to spend, how to finally move the tax system so everyone pays their fair share or we can continue down the road they’re on. But not under the threat of default.”
Republicans voted multiple times to raise the debt limit under President Donald Trump, according to Biden and Democrats.
Biden said he thinks McCarthy is an honest man but that the GOP made him agree to things he does not agree with in order to stay speaker.
McCarthy became the speaker of the House after refusing to allow a vote on a bill to increase the nation’s borrowing authority without federal spending reductions.
On Saturday, Sen. Mike Lee of Utah sent a letter, co-signed by 42 fellow Senate Republicans, to Schumer saying they oppose raising the ceiling without “substantive spending and budget reforms.”
Negotiating with the White House: Why he didn’t complain about the deficits of Reagan, and why he wouldn’t raise taxes
The Tuesday meeting falls as the conservative American Action Network is airing a $250,000 cable ad campaign in the Washington, D.C., area calling on Biden to negotiate with congressional Republicans.
Ahead of the meeting, Business Roundtable CEO Joshua Bolten released a statement saying the “cost of a default, or even the threat of a default, is simply too high.”
“A default would deliver a severe blow to the economy, leading to widespread job losses, decimated retirement savings and higher borrowing costs for families, businesses and the government,” he said. “Failing to raise the debt limit would also threaten the U.S. dollar’s central role in the global financial system to the benefit of China.”
Jeffries and McHenry did not rule out a short term solution to buy time for a longer term deal.
That has been the case in the past. Republicans have pointed out that as a senator, Biden criticized the budget deficits of Reagan’s presidency. In 1984, he presented a proposal to freeze federal spending for a year. He said his plan would make everyone in the Senate look bad, but it went nowhere.
When he was negotiating with the Obama administration, Mr. Biden tied budget issues and the debt limit. Mr. Biden said that he only did that because he was told to get the deal done.
“I got a call that morning at 6 o’clock saying that the Republican leader would only talk to me, and there was no time left,” he said. “And so I sat down, and I got instructions from the White House to settle it. And that was what I did. But I had no notice.”
In the spring of 2011, Mr. Biden and a bipartisan group of congressional leaders met frequently to hash out their differences. In early meetings, the group gathered at Blair House, where foreign dignitaries stay when they visit Washington. The summer of 2016 was the year that Mr. Boehner broke off negotiations because Republicans wouldn’t agree to raise taxes on the wealthy. A complex deal was reached weeks later, leaving Mr. Obama to explain to Democratic voters why he was not able to raise taxes and had agreed to at least $2.4 trillion in spending cuts.