Biden steps in to break US debt ceiling impasse

Joe Biden, who is in Japan for the G7 summit, will speak with the Republican leader on Sunday about the US debt ceiling whose negotiations have taken “a step backwards” according to the White House, each camp accusing himself of blocking discussions.

“The president has asked his team to coordinate” with Kevin McCarthy, the leader of the Republicans in the House of Representatives, to schedule a phone call after his meetings at the G7 which is being held in Hiroshima, in western Japan, said declared the American presidency.

Their interview will take place after Joe Biden’s final press conference scheduled for around 6:15 p.m. local time (09:15 GMT), early in the morning in Washington, according to the same source.

On Saturday evening, negotiations between the White House and the Republican opposition seemed to have reached an impasse, as time is running out to avoid a default by the United States.

This could happen from June 1, with potentially catastrophic consequences for the US economy, and even the world.

– “Step back” –

The negotiations are taking place in the absence of Joe Biden, who has cut short his Asia-Pacific tour due to this debt crisis. He must return to Washington on Sunday after the end of the Hiroshima summit.

Republicans are demanding drastic government budget cuts before giving the green light to raising the debt ceiling.

The Republican team put on the table Friday night “an offer that was a big step backwards and contained a set of extreme partisan demands that could never be passed in both houses of Congress,” the door said in a statement. -speaker of the White House, Karine Jean-Pierre, calling to “be serious”.

And, according to her, it is the Republican officials under the thumb of those close to Donald Trump “who (threaten) to put our nation in default for the first time in our history”, but “not the President (Joe Biden) nor the officials Democrats”.

The leader of the Republicans, Mr. McCarthy, told him on Saturday evening, in a tweet, that “the White House has taken a step back in the negotiations”.

“Unfortunately, the left wing of the Democratic Party seems to be in charge, especially with President Biden out of the country,” he lamented.

Republican leader Kevin McCarthy during a press conference outside the Capitol on May 17, 2023 in Washington (Getty/AFP – WIN MCNAMEE)

The American president had warned on Saturday that he would not give in to the “extreme” demands of the Republicans, but he also said he was optimistic about the ability to conclude an agreement in the coming days.

“I still think we will be able to avoid a default” of payment, he assured journalists on the sidelines of the G7 summit.

– “Big differences” –

“The differences are great on many subjects,” lamented Friday Patrick McHenry, quoted by the site NewsNation.

“There is a way to find a reasonable bipartisan agreement if the Republicans return to the negotiating table in good faith,” said White House communications director Ben LaBolt.

United States federal budget (AFP - Gal ROMA, Sabrina BLANCHARD)
United States federal budget (AFP – Gal ROMA, Sabrina BLANCHARD)

The sticking point between the two camps: the Republicans’ demand to reduce federal spending, to bring it back to 2022 levels. That is to say, cut $130 billion in spending.

“We can’t spend more money next year,” said Kevin McCarthy.

A red line that the Democrats refuse to cross.

The Biden administration has meanwhile pushed to extend the borrowing limit until 2025, according to US media citing officials involved in the talks.

The Democrats want to believe that an agreement remains possible if the two parties agree not to obtain satisfaction on all the demands, according to a source close to the discussions.

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