Joe Biden voiced optimism Tuesday the United States can avoid a potentially catastrophic debt default, although the president was forced to shorten an upcoming Asia tour after his latest crisis talks with Republicans ended with no breakthrough.
Locked in a high-stakes stand-off with Biden over the borrowing limit, the Republican House speaker, Kevin McCarthy, told reporters after meeting the Democratic president there was still “a lot of work to do.”
But while stark differences remained, the White House said Biden was “optimistic that there is a path to a responsible, bipartisan budget agreement if both sides negotiate in good faith and recognize that neither side will get everything it wants.”
And McCarthy likewise indicated he ultimately expected a deal, possibly even by the end of the week, even if so far “nothing has been resolved.”
The US president, who flies to Japan on Wednesday for a G7 summit, was forced to scrap subsequent stops in Papua New Guinea and Australia, instead returning to Washington on Sunday to tackle the crisis.
The Treasury has warned of grim consequences if the country runs out of cash to pay its bills, which would leave it unable to pay federal workers and trigger a likely surge in interest rates with knock-on effects for businesses, mortgages, and global markets.
The White House said Biden had directed his staff “to continue to meet daily on outstanding issues,” and that he would confer with Republican leaders upon his return from the G7 meetings.
Republicans have continued to insist Biden agree to significant spending cuts in exchange for their support to raise the debt ceiling, ignoring Democratic calls for a “clean” increase in the borrowing limit with no strings attached.
Democrats have accused Republicans of using extreme tactics to push their agenda ahead of the so-called “X-date” at which the United States starts defaulting on its debts.
In a sign of growing nervousness over what would be the first-ever US debt default, more than 140 top US chief executives sent a letter to Biden and congressional leaders stressing the need for an agreement.
Roger Barake, with AFP
