WASHINGTON — President Joe Biden on Tuesday repeated his warning to Republicans not to hold the nation’s economy hostage to their budget-cutting demands, this time at a White House meeting about the looming deadline to increase the nation’s borrowing authority to avoid defaulting on the national debt.
Biden met with House Speaker Kevin McCarthy (R-Calif.), who on behalf of his GOP members insists that a debt ceiling hike must be tied to budget cuts, as well as Senate Republican Leader Mitch McConnell (R-Ky.), Senate Majority Leader Chuck Schumer (D-N.Y.) and House Democratic Leader Hakeem Jeffries (D-N.Y.).
“We’re going to get started,” Biden told reporters invited into the Oval Office meeting at the start of the meeting. “We’re going to solve all the world’s problems.”
Treasury Secretary Janet Yellen, a former chair of the Federal Reserve, warned last week that the nation would exhaust its ability to pay debts already incurred as early as June 1 — a month and a half earlier than previous projections.
Biden has insisted that he will not “negotiate” over the debt limit, which represents spending that has already taken place and permits the Treasury to issue bonds to, among other things, make interest payments on outstanding obligations. Most economists believe that defaulting on the debt — which has never happened — would be catastrophic, as the nation’s credit rating would be downgraded and borrowing money would become that much more expensive.
Biden has said that he and Congress should pass a “clean” debt ceiling increase and discuss spending and taxes for the coming and subsequent fiscal years separately.
Biden’s White House pointed out that Republicans who controlled both chambers of Congress from 2017-2019 and the Senate from 2019-2021 raised the debt ceiling three times under his Republican predecessor without once demanding budget cuts. In fact, the national debt increased by 40% over those four years, in part because of trillions in emergency spending during the pandemic, but also because of a massive new tax cut and a repeal of budget caps imposed under former President Barack Obama.
At her daily press briefing Tuesday, press secretary Karine Jean-Pierre called the debt ceiling problem “a manmade crisis” that Republicans could solve easily. “The exit strategy is very clear: do your job,” she said. “Prevent a default.”
