Debt ceiling talks have stalled as the United States heads towards the do-or-die date of June 1 as the president has insisted that the United States should be allowed to rack up as much debt as possible on its credit card. Republicans, on the other hand, have said we should better spend within our means.Â
Who would have thought that an 80-year-old president would act like a reckless teenager?
The Wall Street Journal writes, “President Biden and House Speaker Kevin McCarthy remained at loggerheads after a meeting at the White House on Tuesday, making little progress in averting the first-ever default by the federal government but setting plans for a new round of talks.
House Republicans have demanded deep spending cuts in exchange for raising the debt ceiling. Mr. Biden and Democrats in Congress maintain that the federal borrowing limit should be raised without preconditions and have called the GOP stance irresponsible, as a June deadline looms. Neither side has presented a path forward that could win enough support to pass both chambers of Congress.
In remarks after the meeting, Mr. Biden insisted the nation wouldn’t default, while adding that the ‘politics, posturing and gamesmanship’ will continue in coming weeks. He said negotiators should discuss ‘how to lower the deficit to put our fiscal house in order, but…we need to take the threat of default off the table.’
The California Republican again played down the chances of passing a short-term extension of the debt ceiling, an idea that has been discussed by both Biden administration and congressional aides as an option for giving negotiators more time to hash out their disagreements and to align any deal with the annual spending process. Mr. Biden said he hadn’t ruled out a short-term extension.”
Liberals have argued that they should be able to spend way over our national credit limit without consequence, and Biden, who ran as a moderate, has been pushed to consider minting a coin worth trillions of dollars during a period of high inflation to pay for spending racked up by Democrats last year.
Republicans, however, are preparing a plant to do what any prudent person would do when hitting their credit limit: cut spending and prioritize what needs funding and what really does not.
The Washington Post wrote, “House Republicans are preparing a plan telling the Treasury Department what to do if Congress and the White House don’t agree to lift the nation’s debt limit later this year, underscoring the brinkmanship newly empowered conservatives will bring to the high-stakes negotiations over averting a U.S. default, according to six people aware of the internal discussions.
The plan, which was previously unreported, was part of the private deal reached this month to resolve the standoff between House conservatives and Rep. Kevin McCarthy (R-Calif.) over the election of a House speaker. Rep. Chip Roy (R-Tex.), a leading conservative who helped broker the deal, told The Washington Post that McCarthy agreed to pass a payment prioritization plan by the end of the first quarter of the year.
In the preliminary stages of being drafted, the GOP proposal would call on the Biden administration to make only the most critical federal payments if the Treasury Department comes up against the statutory limit on what it can legally borrow. For instance, the plan is almost certain to call on the department to keep making interest payments on the debt, according to four people familiar with the internal deliberations who spoke on the condition of anonymity to describe private conversations. House Republicans’ payment prioritization plan may also stipulate that the Treasury Department should continue making payments on Social Security, Medicare and veterans benefits, as well as funding the military, two of the people said.”
The two sides are expected to continue negotiations throughout the month.Â
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