Reuters. President Joe Biden and top U.S. congressional Republican Kevin McCarthy said on Wednesday (May 17) they would push ahead on talks to raise the nation's $31.4 trillion debt ceiling and avoid an economically catastrophic default.
After a months-long standoff, the Democratic president and the speaker of the House of Representatives on Tuesday agreed to negotiate directly on a deal, which needs to be reached and passed by both chambers of Congress before the federal government runs out of money to pay its bills, as soon as June 1.
"We're going to come together because there's no alternative," Biden told reporters at the White House.
Biden met for about an hour Tuesday with McCarthy, Senate Majority Leader Chuck Schumer, Senate Republican leader Mitch McConnell and House Democratic leader Hakeem Jeffries after their aides met over the weekend to try to strike a deal.
Republicans have refused to vote to lift the debt ceiling unless Biden and his Democrats agree to spending cuts in the federal budget.
Biden and congressional leaders' staff have met several times over the past week on the issue. Going forward, the talks will be narrowed for more engagement between House Republicans and the White House, McCarthy said. "We've narrowed the group," Biden said.
Biden, who departs for Japan on Wednesday, said he will speak regularly with congressional leaders by phone, and the White House said he would meet with them upon his return.
Continued uncertainty around the debt ceiling prompted Biden to skip stops in Papua New Guinea and Australia after he attends a Group of Seven summit of the world's richest countries in Hiroshima, Japan.
Ahead of the meeting, sources said Biden and McCarthy's aides had discussed the requirements for two key programs that provide food and cash aid to families.
Expanding the work requirements has been a key demand of Republicans who are also pushing for spending cuts in exchange for their votes to raise the debt limit.
"I'm not going to accept any work requirements that's going to impact on medical health needs of people," Biden said, "but it's possible there could be a few other, but not anything of any consequence."
McCarthy told reporters on Tuesday that his party, which controls the House by a 222-213 margin, would only agree to a deal that cuts spending.
In addition to work requirements for some benefit programs for low-income Americans, spending caps and changes to energy permitting have been proposed in exchange for votes to lift the limit, according to people briefed on the talks.
The sources, who spoke on condition of anonymity to reveal details about closed-door negotiations, said the work requirement talks focus on the Supplemental Nutrition Assistance Program (SNAP), previously known as food stamps, and the Temporary Assistance for Needy Families program.
A similar 2011 standoff over the debt limit led to a historic downgrade of the U.S. credit rating, sparking a sell-off in stocks and pushing the government's borrowing costs higher.
The current deadlock has rattled investors, sending the cost of insuring exposure to U.S. government debt to record highs. A Reuters/Ipsos poll completed on Monday found that three-fourths of Americans fear a default would take a heavy toll on families like theirs.
