June 13, 2024

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In the United States, Joe Biden and Republicans have yet to reach an agreement on the debt

In the United States, Joe Biden and Republicans have yet to reach an agreement on the debt

The conflict in Washington continues. On Tuesday, May 16, after a White House meeting with Republican opponents, Joe Biden said he was optimistic about the possibility of the US avoiding a default on payments that could happen in two weeks. “There is still work to be done on many difficult issues”But the President of the United States “faith” As a conclusion “Fair Budget Agreement”The White House said in a statement.

On the Republican side, however, the tone is more cautious. This was the meeting “Slightly Overproduced” Earlier, Republican House Speaker Kevin McCarthy said on May 9. America’s short-term financial fate largely depends on him.

The state president will again meet key Congress officials over phone this week. He will meet them again in person after returning on Sunday from a trip to Japan for the G7 meeting. In a sign of the urgency and difficulty of the discussions, the White House announced that Joe Biden had canceled a major diplomatic tour he was scheduled to make after summits in Papua New Guinea and Australia.

read more: The article is reserved for our subscribers US Debt: The US is dangerously close to default

“Our positions are still far apart, but what has changed during this meeting is that the president has chosen two people from his administration to negotiate directly with us.”Kevin McCarthy told reporters. “That doesn’t mean we’re going to reach an agreement.”But it is “Procedure Improved”He continued, however, adding: “I’m not very optimistic”.

“Disaster for America and the whole world”

In the midst of a presidential campaign and high political tensions, neither the president, a candidate for a second term, nor a conservative incumbent prefers to go first.

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The White House has repeatedly warned of a possible default, a scenario in which the federal government would not be able to pay a penny, pay salaries, pay benefits, pay taxes or repay creditors. It will be “catastrophe” And “Disaster for America and frankly the world,” Joe Biden said in a video posted on Twitter ahead of the meeting.

read more: Janet Yellen Says US Debt Default Could Cause “Global Financial Crisis”

An unprecedented US payments default could occur in 1R June if Congress does not agree to raise the authorized public debt ceiling.

“We urge that an agreement be reached as soon as possible so that the country can avoid this catastrophe.”The CEOs of more than 140 US companies, including Pfizer, Morgan Stanley and Goldman Sachs, made the call in an open letter to White House and congressional officials on Tuesday.

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The parliamentary calendar further complicates the matter. The House of Representatives and the Senate together constitute Congress, and must vote on the debt, not sitting at the same time until 1.R June, for four days only.

Biden refuses to politicize the process

The US Congress usually – this is country specific – raises the maximum public debt ceiling. However, Kevin McCarthy’s Republicans refuse to vote in this direction unless Joe Biden accepts significant budget cuts.

Officially, the White House refuses to negotiate on raising the debt ceiling, which has long been standard practice. Joe Biden refuses to allow these debates to become politicized, arguing that the debt has been piled up by governments on both sides.

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But in reality, many options are on the table. Republicans and Democrats have budgeted tens of billions of dollars to respond to the Covid-19 pandemic, but were never used, and should be rescinded, thus reducing public spending.

read more: The article is reserved for our subscribers In the US, Republicans condition budget cuts on raising the debt ceiling

Also under discussion, according to the US press: the allocation of permits in the energy sector, and the tightening of conditions for the allocation of certain social benefits. This last option is drawing the ire of some elected Democrats on the far left, such as Senator Elizabeth Warren, who condemned it on Capitol Hill on Tuesday. “A direct attempt to deprive people of the benefits they depend on for survival”.

The world with AFP