President Joe Biden and Republican leader Kevin McCarthy are scheduled to meet at the White House on Monday to discuss raising the United States debt ceiling.
Sunday, as the president returned from the G7 summit in Japan, they spoke on the telephone.
The two parties remain at variance over the budget cuts demanded by the Republicans as a prerequisite for raising the ceiling. The inability to do so by June could lead to the United States defaulting on its debt.
The government could not borrow additional funds or pay all of its obligations. It would also threaten to destabilize the global economy by impacting prices and mortgage rates in other nations.
As he departed Japan on Sunday, Vice President Joe Biden told reporters that Republican proposals for the House of Representatives were “simply, quite frankly, unacceptable.”
He added, “It is time for Republicans to recognize that there is no bipartisan agreement that can be reached on their partisan terms alone. Additionally, they must move.” However, Mr. Biden also indicated his willingness to reduce expenditures to reach a compromise.
Following the three-day summit in Hiroshima, the president canceled foreign trips to resolve the impasse over the national debt.
Mr. McCarthy previously characterized his conversation with Mr. Biden as fruitful.
“I think we can solve some of these problems if he understands what we’re looking at,” he told reporters after their discussion.
On Sunday evening, an approximately two-and-a-half-hour summit was held in Mr. McCarthy’s office on Capitol Hill.
According to Steve Ricchetti, one of Mr. Biden’s representatives and a senior adviser to the president, the negotiating teams will continue to work overnight.
In the meantime, Treasury Secretary Janet Yellen stated on Sunday that the 1st of June remained a “firm deadline.” She told NBC that “we expect to be unable to pay all of our bills in early June” if no agreement is reached.
Failure to increase the debt ceiling could result in suspending social insurance payments and federal and military employee salaries.
The impasse has shaken up the financial markets. The Dow fell 0.3%, the S&P 500 fell 0.1%, and the Nasdaq fell 0.2% on Friday.
In exchange for their support in raising the debt ceiling, Republicans demand $4.5tn (£3.61tn) in budget concessions, including eliminating several of Mr. Biden’s legislative priorities. Additionally, they seek increased funding for the military and border security.
President Biden and Mr. McCarthy faced pressure from their respective parties’ left and proper factions to maintain the status quo.
With a one-seat Democratic majority in the Senate and a razor-thin Republican majority in the House, an agreement has thus far proven elusive.
